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Bureau of Mines Information Circuiar/1984 




Nickel Availability—Market Economy Countries 

A Minerals Availability Program Appraisal 

By D. i. Bieiwas 




UNITED STATES DEPARTMENT OF THE INTERIOR 



,f^^ M^.JlMmf¥^ 



InformatiorTCircularjBSSS 



w 



W 



Nickel Availability— Market Economy Countries 
A Minerals Availability Program Appraisal 

By D. I. Bleiwas 




UNITED STATES DEPARTMENT OF THE INTERIOR 
William P. Clark, Secretary 

BUREAU OF MINES 
Robert C. Norton, Director 



As the Nation's principal conservation agency, the Department of the 
Interior has responsibility for most of our nationally owned public lands 
and natural resources. This includes fostering the wisest use of our land 
and water resources, protecting our fish and wildlife, preserving the 
environmental and cultural values of our national parks and historical 
places, and providing for the enjoyment of life through outdoor recreation. 
The Department assesses our energy and mineral resources and works to 
assure that their development is in the best interests of all our people. The 
Department also has a major responsibility for American Indian reserva- 
tion communities and for people who live in island territories under U.S. 
administration. 






Library of CongrM* Cataloging In PublleaMon Data 

Biclwas, Donald I. 

Nickel availability. 

(Information circular/ United States Department of the Interior, Bureau of Mines; 8995) 

Bibliography: p. 32 

Supt. of Docs, no.: I 26.27: 

1 . Nickel industry. 2. Nickel. I. Title. II. Series: Information circular (United States. Bureau 
of Mines); 8995. 

TN295.U4 [HD9539.N^ 622 8 ^36.2'74^ 84-600150 



00 
I 



a. 



I 



y 

^ 



PREFACE 



s The Bureau of Mines is assessing the worldwide availability of nonfuel minerals. 

(_y5 The Bureau identifies, collects, compiles, and evaluates information on active, developed, 

and explored properties, deposits and mines, and on mineral processing plants worldwide. 

Objectives are to classify domestic and foreign resources ; to identify, by cost evaluation, 

r^ resources that are reserves; and to prepare analyses of mineral availabilities. 

V This report is part of a continuing series of Bureau of Mines reports analyzing the 

^ availability of minerals from domestic and foreign sources, and the factors that affect 

—0 availability. Analyses of other minerals are in progress. Questions about the program 

"^■^s^ should be addressed to Chief, Division of Minerals Availability, Bureau of Mines, 2401 

E St., NW., Washington, DC 20241. 



CONTENTS 



Page 

Preface iii 

Abstract 1 

Introduction 2 

Acknowledgments 2 

World nickel industry 2 

Products and uses 2 

Pricing structure 3 

Nickel production 3 

Smelting, refining, and trade patterns 4 

Consumption 5 

Tariffs 6 

Evaluation method 6 

Nickel resources and geology 7 

Sulfide deposits 11 

Canada 11 

Ontario 11 

Manitoba 12 

Australia 13 

South Africa 13 

Zimbabwe 13 

Botswana 14 

United States ] 4 

Laterite deposits 14 

New Caledonia 14 

Philippines 15 

Indonesia 15 

Greece 15 

Dominican Republic 15 

Australia 15 

United States 16 

Other countries 16 

Manganese nodules 16 

Mining and processing technologies 16 

Sulfide technologies 16 

Mining 16 

Beneficiation 17 

Pyrometallurgical post-mill processing .... 17 

Hydrometallurgical post-mill processing ... 17 

Refining of nickel 17 



Page 

Laterite technologies 18 

Mining 18 

Post-mine processing ; 18 

Pyrometallurgical methods 18 

Ferronickel production 18 

Matte production 18 

Hydrometallurgical methods 18 

Nickel production costs 19 

Operating costs 19 

Producing sulfide mines 19 

Producing laterite mines 20 

Nonproducing sulfides 21 

Nonproducing laterites 22 

Capital costs 22 

Nickel availability analyses 23 

Methodology 23 

Total availability 23 

Sulfides 24 

Laterites 24 

Regional availability 24 

Annual availability 25 

Producing mines 26 

Nonproducing deposits 27 

Factors affecting nickel production cost 28 

Energy 28 

Sulfides 28 

Laterites 28 

Labor 29 

Sulfides 30 

Laterites 30 

Coproducts and byproducts 30 

Sulfides 30 

Laterites 30 

Conclusions 31 

References 32 

Appendix A. — List of centrally planned economy 

countries 33 

Appendix B. — Deposits investigated but not 

evaluated 33 



ILLUSTRATIONS 



1. Market economy country nickel production in 1981 3 

2. Distribution of 1981 world nickel consumption 5 

3. Flowchart of MAP evaluation procedure 6 

4. Location map of evaluated deposits 10 

5. Classification categories of mineral resources 10 

6. Geographic distribution of resources and ore types of evaluated deposits and properties , H 

7. Resources and production status of evaluated sulfide and laterite deposits 11 

8. Geological and location map of the Sudbury District, Ontario, Canada 12 

9. Total recoverable nickel available from market economy countries 23 

10. Total recoverable nickel from southwest Pacific producers and nonproducers 24 

11. Total recoverable nickel from Canadian producers and nonproducers 25 

12. Total recoverable nickel from U.S. deposits 25 

13. Annual nickel production available from producing sulfide and laterite mines at $3.50/ lb Ni 26 

14. Potential annual nickel production from producing mines in Canada 26 

15. Potential annual nickel production from producing mines in the southwest Pacific 26 

16. Potential annual nickel production from nonproducing nickel deposits 27 

17. Effect of energy cost increases on nickel availability 29 

18. Effect of labor cost increases on nickel availability 30 

19. Effect of byproduct revenues on nickel availability 31 



VI 



CONTENTS — Continued 



TABLES 

Page 

1. World mine production by country 3 

2. Major market economy nickel companies 4 

3. World nickel consumption 5 

4. Nickel deposits evaluated 8 

5. Nickel resources by region and country 10 

6. Recoverable nickel from producing and nonproducing deposits 11 

7. Estimated mine and mill operating costs for producing nickel mines 19 

8. Estimated production costs for producing nickel mines in selected countries 20 

9. Estimated mine and mill operating costs for nonproducing nickel mines 21 

10. Estimated production costs for nonproducing nickel deposits in selected countries 21 

11. Commodity prices used in analyses 23 

12. Total nickel available from market economy countries at selected cost ranges 23 

13. Effect of oil price on nickel production at Falconbridge Dominicana, 1973-81 29 



UNIT OF MEASURE ABBREVIATIONS USED IN THIS REPORT 



bbl 


barrel 


°C 


degree Celsius 


kWh 


kilowatt hour 


lb 


pound 


It 


long ton 


Itu 


long ton unit 


m 


meter 



oz troy ounce 

oz/t troy ounce per metric ton 

pet percent 

psi pound per square inch 

t metric ton 

tpd metric tons per day 

tpy metric tons per year 



NICKEL AVAILABILITY -MARKET ECONOMY COUNTRIES 



By D. I. Bleiwas 



ABSTRACT 

Bureau of Mines personnel evaluated the potential availability of nickel from 151 
deposits in 18 market economy countries and selected 126 for detailed analyses. An evalu- 
ation was made of tonnage-cost relationships indicating the quantity of nickel available 
at various total costs of production expressed in dollars per pound nickel, including a 
15-pct rate of return on the invested capital. 

The 126 deposits studied contain approximately 73 million metric tons (t) of nickel. 
An estimated 52 million t is available from laterite deposits, of which less than 2 pet 
could be produced at $3.50/lb Ni, about equal to the average published price of nickel in 
1981. Approximately 21 million t of nickel is available from sulfide deposits, of which 
about 10.0 million t can be produced at $3.50/lb. Sensitivity studies performed for both 
laterite deposits and sulfide deposits indicate that the total cost of nickel from laterites 
is most sensitive to increases in energy costs, and that sulfides are most sensitive to in- 
creases in labor costs; sulfides are also sensitive to changes in byproduct revenues. In 
1983 the Nickel Mountain mine in Oregon was the only U.S. producer, though develop- 
ment continued on the Gasquet property in California. Of the total 5.1 million t of re- 
coverable nickel in the United States, about 20 pet is available at or below $3.50/ lb. 



* Physical scientist (geologist), Minerals Availability Field Office, Bureau of Mines, Denver, CO. 



INTRODUCTION 



Nickel is a strategic and critical material. A 
strategic and critical material is defined as a com- 
modity whose lack of availability during a national 
emergency or strategic situation would seriously 
affect the economic, industrial, and defensive posture 
of the United States. In consideration of the import- 
ance of nickel, this study attempted to assess the 
resource position of the United States in relationship 
to that of other nickel-producing nations and to 
determine the availability of nickel in market economy 
countries. 

Nickel, primarily in the form of metal and ferro- 
nickel, is derived from the mining and processing of 
nickel sulfide and laterite deposits. Most of the nickel 
consumed in the world originates from sulfide ores in 
Canada, Australia, and the Soviet Union and from 
laterite ores in Cuba, the Dominican Republic, New 
Caledonia, and other countries in the South Pacific. 
Nearly 60 pet of the U.S. primary nickel requirements 
are met by imports from Canada. The dependence of 
the United States on foreign sources for nickel, cur- 
rently over 80 pet, is of concern to the U.S. Govern- 
ment as well as the private sector. (Information Cir- 
cular 8988, "Nickel Availability — Domestic, A Miner- 
als Availability Appraisal", covers the availability of 
nickel from the United States.) 



By evaluating and analyzing current and potential 
nickel resources, estimating production costs, and 
conducting sensitivity analyses, it is possible to assess 
the position of the United States with respect to nickel 
availability in market economy countries. The initial 
procedure was to identify significant market economy 
country nickel deposits. A review of 151 deposits and 
properties was conducted to determine their resource 
tonnage and nickel grade. From this initial list, 126 
deposits were selected for detailed availability analy- 
sis. (Deposit selection criteria, technologies, and asso- 
ciated costs are addressed in the appropriate sections 
of the text.) Deposit data were used to construct 
resource availability curves relating potential nickel 
"production to total cost. Availability curves are 
presented for total recoverable nickel from all sources, 
for key producing regions, for sulfide deposits and for 
laterite deposits. Curves are also presented relating 
annual production potential for producers and non- 
producers to production cost. 

The cost of nickel production is affected to various 
degrees by labor costs, energy costs, and byproduct 
revenues. The effect of these costs on the availability 
of nickel, from both sulfides and laterites, is com- 
pared. 



ACKNOWLEDGMENTS 



Domestic production and cost data for the de- 
posits analyzed in this study were developed at Bureau 
of Mines Field Operations Centers located in Denver, 
CO; Juneau, AK; Spokane, WA; and Pittsburgh, PA. 
World production and cost data were collected through 



a Bureau contract with Colder Associates and by 
personnel of the Bureau's Minerals Availability Field 
Ofiice. Scott Sibley, Bureau of Mines Commodity 
Specialist, is also acknowledged for his assistance in 
the selection of deposits evaluated in this study. 



WORLD NICKEL INDUSTRY 



Over the past three decades significant changes 
have taken place in nickel production and development 
that impact nickel availability. The following sections 
describe the current nickel product forms, uses, and 
pricing structure; major changes in key producing 
operations and areas; and major consumption pat- 
terns. In 1981, virtually all of the world's nickel 
originated from 20 countries, of which 15 are market 
economy countries. Market economy countries pro- 
duced about 70 pet of the world's nickel. The three 
largest producers were Canada, New Caledonia, and 
the U.S.S.R. Canada is a major supplier of nickel to 
both the United States and other market economy 
countries. However, growth of the nickel industry in 
the Pacific region, specifically New Caledonia, has had 
a dramatic effect on Canada's market share and world 
trade patterns. 



PRODUCTS AND USES 

Primary nickel products are divided into two 
classes based on their nickel content. Class I products 
have a nickel content of at least 99 pet. Products of 
this type can generally be used without constraints 
for many applications. The most common Class I 
products include electrolytic cathodes, 99.9 pet Ni, and 
carbonyl pellets, 99.7 pet Ni. Other Class I products 
having some constraints on their application are 
briquets, rondels, and nickel-89, (1, p. 1-6). ^ 

Class II products, suitable for specific limited 
applications, contain some residual elements and have 
a nickel content ranging from 20 to 96 pet. The most 



' Italicized numbers in parentheses refer to items in the hst of references 
preceding the appendix. 



common Class II product forms are ferronickel (20 to 
50 pet Ni) and nickel oxide sinter (76 to 90 pet Ni). 
A Class II product introduced in 1976 is Incomet, 
containing 94 to 96 pet Ni. Nickel salts containing 
20 to 25 pet nickel are also included with Class II 
product forms {1, p. 1-6). Nickel matte, ranging from 
40 to 75 pet Ni, is considered an intermediate product. 

More than 80 pet of the use of nickel in its pri- 
mary forms is as an alloying agent that adds corrosion 
resistance and strength to other metals. More than 
60 pet of these alloys are used by the steel industry. 
Other primary forms are used in nickel alloys other 
than stainless steel or alloy steel. These include super- 
alloys, other high-temperature alloys, and nonferrous 
alloys. Pure nickel is also used in electroplating. Nickel 
salts and nickel oxides are used as catalysts, in bat- 
teries, fuel cells, and insecticides {2, p. 613). Ferro- 
nickel, a class II product, has its greatest application 
in the production of stainless and alloy steel. 



PRICING STRUCTURE 

Historically, the market price of all primary nickel 
products is related to the price and nickel content of 
Inco's electrolytic cathodes. (Inco is the largest market 
economy producer of nickel.) However, in the last few 
years nickel has been available on the market for 
prices significantly below those published. In 1981, 
nickel sold for as low as $2.75/ lb although the pub- 
lished price was about .?3.50/lb. Since 1972, the price 
of ferronickel and nickel oxide sinter has generally 
been 6 and 15 pet, respectively, below the price per 
pound of contained nickel in electrolytic cathodes (i, 
p. VI-10). 



NICKEL PRODUCTION 

The structure of the nickel industry in market 
economy countries has changed dramatically since 
1950, as illustrated in table 1. The production share 
of nickel from the industrialized nations dropped from 
76 pet in the early 1950's to 47 pet in 1977. The share 
from the developing countries (New Caledonia, Do- 
minican Republic, and Indonesia), however, increased 
from 4 pet to 24 pet in the same time period. Figure 1 
illustrates a breakdown of market economy nickel 
mine production in 1981. 

Overall, centrally planned economy (CPE) pro- 
duction (see appendix A), rose from 20 pet of world 
nickel production in 1950-51 to 31 pet in 1981. Cana- 
dian production fell dramatically during the same 
period, falling from about 75 pet of the total world's 
mine output of nickel in the 1950's to only 22 pet in 
1981. The decrease in Canada's share of the market 
occurred partly because of production from new 
operations in Greece and Australia but primarily 
because of the rise in production from developing 
countries, specifically New Caledonia, Indonesia, and 
the Philippines {1, p. II-l, II-3). 

Over the last 25 years. New Caledonia's produc- 
tion grew at a rate averaging 12 pet annually (2, p. II- 



TABLE 1. — Estimated world mine production by country (3) 
(10^ t NI) 

Country 1950-51 1981 

Average pet world -Average pet world 

Market economy countries: 

Australia 74 10 

Botswana 17 2 

Brazil 3 1 

Canada 119 75 160 22 

Dominican Republic 20 3 

Finland 3 1 

Greece 16 2 

Indonesia 26 4 

New Caledonia 6 4 75 10 

Philippines 37 5 

South Africa 1 1 26 4 

United States 1 1 11 2 

Other market economy 

countries — — 38 5 

Total 

Centrally planned economy 
countries: 

Cuba 

U.S.S.R 

Other 

Total 

Total world 158 100 724 100 

' Numbers may not add up owing to independent rounding. 
^ Production in 1980 was approximately 20 pet larger. 



1), and accounted for about 10 pet of world mine pro- 
duction in 1981. Three other countries — Australia, 
Indonesia, and the Philippines — accounted for about 19 
pet mine output in 1981. Inco of Canada was a prime 
force in the development of laterites in Indonesia. 
Despite the dramatic increase in nickel production 
from developing countries, industrialized countries 
still dominate the critically important smelting and 
refining industry and will probably continue to do so 
for the foreseeable future. 

The U.S.S.R. led the CPE countries in nickel 
production, with 22 pet of the world production for 



127 


82 


506 


71 




31 






20 




40 

158 

20 


6 

22 

3 


31 


20 


218 


31 




Domirticon Republic 
4 pet 



Botswana 
3 pet 



Unit«J StotM 
2 pet 



Philippines 
7 pet 



Total » 506,000 metric tons 
FIGURE 1.— Market economy country nickel production In 
1981. 



1981, an increase of approximately 5.4 pet per year 
since the 1950's. Nickel mine production from the 
U.S.S.R. in 1981 was 158,000 t, up from 31,000 t in 
1950. In 1976 the U.S.S.R. produced approximately 
132,000 t of nickel, of which 30,000 t was exported 
(about 5 pet of the total market economies' nickel 
production). The Soviets have negatively affected the 
world nickel market by occasionally selling large 
quantities of nickel for less than the market price. 

Cuba produced 40,000 t of nickel in 1981, 5.5 pet 
of world production. Plans are to expand production 
to 76,000 t by 1985. Cuba is believed to have very 
large land-based nickel reserves and could become the 
largest mine producer of nickel by 1990 with an even- 
tual capacity of 110,000 t nickel annually. It is believed 
that the Soviet Union refines about 65 pet of Cuban 
nickel output. Cuba's nickel purchasers are Japan, 
Italy, Spain, Mexico, and other CPE countries. Total 
nickel production from all CPE's is approximately 31 
pet of world production {1, p. II-l, II-2) . 

Four firms, Inco, Falconbridge Nickel Mines Ltd., 
Soeiete Metallurgique Le Nickel (SLN), and Western 
Mining Corp., account for the majority of market 
economy country nickel mine production (^). Table 2 
reports total world nickel production and percent of 
world nickel production for the leading producers. 

Inco Ltd. was incorporated in 1916. The name of 
the company was changed to Inco from the Inter- 
national Nickel Company of Canada Limited, in 1976 
(5). Inco is the market economy countries' largest 
producer of nickel, accounting for about 33 pet of 
1981 market economy production. They are also a 
major producer of byproduct copper, cobalt, and the 
platinum-group metals (PGM). The company's prin- 
cipal mines and processing centers are located adja- 
cent to or near the Sudbury, Ontario, and Thompson, 
Manitoba, districts of Canada. Inco has other mining 
and processing facilities at Port Colborne, Ontario, 
Canada; Acton, England; Indonesia; and Clydach, 
Wales. 

SLN is a vertically integrated French company 
whose nickel mining and smelting operations are 
primarily located on the west coast of New Caledonia 
at Nepoui Center. Its Doniambo smelter, the world's 
largest ferronickel plant, has a capacity of about 
90,000 t of Ni. About 75,000 t of this capacity is in 
ferronickel which is shipped to France, Japan, and 
the United States. The remaining nickel, contained in 
high-grade sulfide matte, is shipped to a hydrometal- 
lurgical refinery at LeHavre, France, and to refineries 

TABLE 2.— Major market economy nickel producers {1) 

1972 1975 1980° 

Production Production Production 

Company name and primary Pet of Pet of Pet of 

operation location 1 0^ t total lOM total lOM total 

Inco Ltd., Canada 181.8 38.6 208.5 38^3 240 30.7 

SLN, New Caledonia 72.7 15.5 75.0 13.8 85 10.9 

Falconbridge Ltd., Canada . . . 43.3 9.2 28.0 5.1 45 5.8 
Western Mining Corp., 

Australia 29.5 6.3 30.0 5.5 30 3.8 

All other market economy 

producers 142.9 30.4 202.9 37.3 381 48,8 

Total 470.2 100.0 544.4 100.0 781 100.0 

° Estimated. 



in Japan. Overall, SLN produces about 11 pet of total 
world nickel production and is the second largest nickel 
producer in the market economy countries. 

Falconbridge is the third largest- nickel producer 
of the market economy countries, providing nearly 6 
pet. The company has been involved in the mining, 
processing, and marketing of metal products since 
1928 {6). Falconbridge produces electrolytic nickel, 
ferronickel, cobalt, copper, and precious metals. Its 
principal mining operations are located in Manitoba 
and Ontario, Canada, as well as in South Africa, the 
Dominican Republic, and Norway. Falconbridge main- 
tains its own fleet of cargo ships which transport 
Canadian nickel-copper matte to Faleonbridge's re- 
finery in Norway. 

Western Mining Corp. (WMC), of Australia, is 
a relatively new nickel producer. The company aver- 
aged 6 pet of world nickel output between 1972 to 
1975, but its share dropped to about 4 pet in 1980. 
Western Mining Corp. produces matte from sulfide 
deposits. 

The United States has only two nickel producers, 
neither of which is a major producer on a world scale. 
The Hannah Mining Co. is the only U.S. company to 
exploit a North American laterite. The mine-ferro- 
nickel plant at Riddle, OR, was temporarily shut down 
in April 1982 but reopened in 1983. The mine ac- 
counted for only about 1.2 pet of market economy 
production in 1981 and approximately 7 pet of U.S. 
demand. The only other nickel producer in the United 
States is AMAX, which produces nickel and its 
associated byproducts from imported nickel mattes 
at its Port Nickel Refinery in Louisiana. 



SMELTING, REFINING, 
AND TRADE PATTERNS 

Canada has the world's largest nickel smelting 
and refining capacity. In 1981, Canada produced about 
115,000 t of nickel in matte and refined forms (a 30- 
pct drop from 1980 production), nearly one-fifth of 
the market economy countries' contained nickel in 
matte. Canada's smelter capacity is estimated at ap- 
proximately 270,000 t of matte, but significant reduc- 
tions in production have resulted from the current 
worldwide depressed economic situation and Canadian 
environmental restrictions governing air quality. In 
1979, approximately 88,000 t of matte was refined in 
Canada. Inco shipped 16,000 t of nickel in matte to 
Clydach, Wales, to be refined, and Falconbridge ship- 
ped 26,700 t of nickel in matte to its refinery in 
Kristiansand, Norway. The Norwegian refinery also 
receives matte from Western Platinum Ltd.'s platinum 
mines in South Africa. 

Japan is the second leading producer of smelted 
and refined nickel products for market economy coun- 
tries. Plant capacity is estimated to be 133,000 t of 
contained nickel annually, about 13 pet of 1980 world 
production. 97,000 t of this capacity is in the form of 
ferronickel, about 28,000 t as nickel metal and 6,000 t 
as nickel oxide (7, p. 27). Approximately 86,785 t of 
nickel was smelted in 1981. Japan has no domestic 



mine production and is dependent entirely on nickel 
imports. Japan imports laterites for ferronickel pro- 
duction primarily from New Caledonia, and concen- 
trates for nickel metal production are purchased 
primarily from Australia. 

Production from New Caledonia accounts for 
slightly more than 10 pet of the world nickel produc- 
tion and ranks third among market economy countries. 
SLN operates the world's largest ferronickel plant, 
the Doniambo plant in New Caledonia. The plant has 
an annual capacity of about 90,000 t of nickel con- 
tained in ferronickel and nickel matte. The majority 
of the plant's ferronickel production is sent to France, 
Japan, and the United States. The matte is sent 
primarily to LeHavre, France, where it is refined. 
Additional tonnages of laterite ore are mined and 
dried in New Caledonia by independent producers and 
shipped to Japan. 

Australia produced approximately 42,500 t of 
nickel in 1981 and ranks as the fourth largest pro- 
ducer of nickel in the world (in concentrate) and 
second largest producer of refined nickel. Western 
Mining Corp., a vertically integrated company, ac- 
counted for most of Australia's"^ nickel production. 
Most of the remaining production is from Western 
Selcast Pty. Ltd., and Metals Exploration Ltd. The 
majority of Australia's nickel sulfide concentrates are 
smelted at Western Mining's smelter at Kalgoorlie, 
Australia. Western Selcast's share of the matte is 
shipped to the AMAX refinery at Port Nickel, LA. 
About 65 pet of Western mining's overall production 
of matte, as well as some excess flotation concentrates, 
are shipped to Japan; most of the remainder is ship- 
ped to the United States and Canada. Western's 
refinery at Kwinana has a design capacity of 30,000 
tpy of nickel. Greenvale, an Australian laterite opera- 
tion, consists of a mine and hydrometallurgieal plant. 
The refinery has a capacity of about 24,000 tpy of 
nickel metal plus about 3,000 tpy of combined nickel 
and cobalt in sulfide concentrate. The nickel and 
mixed sulfide concentrates are exported to Japan 
where they are refined into metals. 

Philippine smelter production was about 23,900 t 
of contained nickel in 1981. Laterite ore containing 
about 15,000 t of nickel, as well as some mixed nickel 
sulfide concentrate and refined nickel, were shipped to 
Japan. Plans have been announced concerning ex- 
pansion of Philippine mining and processing facilities. 

Indonesian production, primarily that from P.T. 
Inco's laterite operations at Soroako, was about 31,000 
t of nickel in ore, matte, and ferronickel in 1981. This 
was considerably less than the design capacity of 
45.000 tpy. Only about 4,800 t of ferronickel was 
produced in 1981. Approximately 19,000 t of dried 
laterite ore was exported. Indonesia exports to Japan 
nearly all of its nickel laterite ore for ferronickel 
production and about half of its nickel matte produc- 
tion. The remaining nickel matte is shipped to Cly- 
dach, Wales, for refining. 

The United States, the world's largest consumer 
of nickel, produces only a small amount from domestic 
resources. The only mine production in the United 
States is from the Nickel Mountain, OR, laterite mine- 



ferronickel plant operated by the Hannah Mining Co. 
The design capacity of the plant is 14,000 tpy of con- 
tained nickel. Virtually all of the production is for 
domestic consumption. 

The Port Nickel refinery at Port Nickel, LA, 
processes matte from Botswana, Australia, and other 
countries. This refinery has a capacity of about 42,000 
tpy of nickel as nickel briquets and powders, and a 
capacity of 20,000 tpy of copper and 600 tpy of cobalt. 
Although most of the production is exported (33,000 
tpy), some is for domestic consumption. 



CONSUMPTION 

The general pattern of nickel consumption has 
changed very little over the past 30 yr. Industrialized 
countries currently account for about 70 pet of total 
world consumption. Specifically, the United States and 
Japan account for about 48 pet and CPE countries 
about 26 pet. Table 3 shows 1950 and 1981 world 
nickel consumption and figure 2 illustrates the dis- 
tribution of nickel consumption among the major 
countries. The average annual growth rate in con- 
sumption for market economy countries through 1990 
is estimated at 2.1 pet (3). 

The United States leads the world in the consump- 
tion of nickel products, about 26 pet in 1980. In 1981, 



TABLE 3. — Estimated world nickel consumption (primary) {1, 

4,7) 

1950 world 1981 world Average annual growth 
consumption consumption rate, 1950-81 
Country or region iQat pet 10^ t pet pct 

Europe 38 24 182 28 5^2 

Japan 1 1 105 16 17.0 

United States 85 54 131 20 1.4 

Other market 

countries 68 10 19.1 

CPE's 32 21 167 26 5^5 

Total 156 100 653 100 4.7 




Total = 654,000 metric tons 

FIGURE 2.— Distribution of 1981 world nicl<el consumption. 



Bureau of Mines estimated that the United States 
consumed approximately 131,000 t of primary nickel, 
and another 47,000 t of nickel was consumed from 
secondary sources, mostly from recycled material. 
Since the 1950's, the annual growth has been about 
1.4 pet. In 1981, the United States imported most of 
its nickel, in various forms, from Canada, Norway, 
Botswana, Australia, New Caledonia, and the Domini- 
can Republic. Norwegian nickel originates from Cana- 
dian ore; therefore, total imports from Canadian ore 
are nearly 48 pet. 

Japan is the world's second leading consumer of 
nickel products, accounting for about 16 pet of world 
consumption. Japan has no domestic mine production 
and must import all its nickel, mostly in the form of 
dried ore from the Philippines and Indonesia. Con- 
centrate and matte from Australia and New Caledonia 
are also imported. Japan's average annual growth 
rate in nickel consumption since the 1950's has been 
about 17 pet, the highest for any of the world's 
industrialized countries. 

Western Europe consumes nearly a third of the 
world's nickel, with an average annual growth rate of 



5.2 pet since the 1950's. Germany and France lead 
with average annual growth rates of 8.4 and 7.4 pet, 
respectively; over the past 10 yr the United Kingdom's 
growth rate has been about 2.0 pet. 

Consumption of nickel by CPE countries is led 
by the Soviet Union. The average annual growth rate 
for these countries has been about 5.5 pet since 1950. 



TARIFFS 

There are few taxes applied to imports of nickel 
into the United States. However, all import taxes 
expire in 1987, at which time countries that have 
most-favored-nation status will not incur any import 
tax on nickel or its associated products (nickel ore 
and concentrates, nickel oxide, ferronickel, unwrought 
nickel, waste and scrap, and nickel powder). 

Those countries that do not have most-favored- 
nation status incur a $0.03/ lb tax on imported un- 
wrought nickel, waste and scrap, nickel powders, and 
ferronickel. 



EVALUATION METHOD 



Figure 3 is a flowchart of the Bureau's Minerals 
Availability Program (MAP) evaluation process from 
deposit identification to the development of avail- 
ability curves. Properties were selected for the study 
with the aim of including at least 85 pet of current 
production from key nickel-producing areas in market 
economy countries. Significant developing and ex- 
plored deposits and past producers were also included. 



The CPE countries were not included in the avail- 
ability study, owing to the difficulty of acquisition of 
data. 

After a deposit was selected for analysis, an 
evaluation was performed to estimate the costs to 
recover nickel. Domestic properties v/ere evaluated by 
personnel at Bureau of Mines Field Operations Cen- 
ters in Denver, CO, Juneau, AK, Spokane, WA, and 



Identification 

and 

selection 

of deposit* 



Tonnage 
^-*\ and grade 
determination 



Engineering 
•nd cost 
evaluation 



Deposit 

report 

preparation 



Mineral 

Industries 

Location 

System 

(MILS) 

data 



MAP 

computer 

data 

base 



MAP 

permanent 

deposit 

files 



Data 

selection and 

validation 



Taxes, 

royalties, 

cost Indices, 

prices, etc... 



Economic 
analysis 



Data 



Availability 
curves 



Analytical 
reports 



J 



Variable and 

parameter 

adjustnoents 



Sensitivity 
analysis 




Data 



Availablltty 
curves 



Analytical 
reports 



FIGURE 3.— Flowchart of MAP evaluation procedure. 



Pittsburgh, PA. Foreign deposits were evaluated by 
personnel of the Minerals Availability Field Office in 
Denver, CO, from data collected by contractors. 

For producing properties, the designed mining 
and milling capacities were used. For deposits not in 
production, appropriate mining, concentrating, smelt- 
ing, refining, transportation methods, and other pro- 
duction parameters were assigned based on applicable 
engineering principles, feasibility studies, and dis- 
cussion with industry personnel. 

Capital expenditures were determined for ex- 
ploration, acquisition, development, mine and mill 
plant and equipment, plus smelter and/ or refiner, if 
required. All capital costs include mobile and station- 
ary, construction and engineering equipment, support 
facilities and utilities, and working capital. Facilities 
and utilities (infrastructure) include access, water 
facilities, power supply, port facilities, and personnel 
accommodations. Working capital is a revolving cash 
fund required for operating expenses such as labor, 
supplies, taxes, and insurance. Either 60 or 90 days 
of operating costs was most commonly used in the 
evaluations. 

Based on the MAP methodology, all capital invest- 
ments incurred 15 yr or more before the initial year 
of the analysis (January 1981) are treated as sunk 
costs. Capital investments incurred less than 15 yr 
before January 1981 have the undepreciated balances 
carried forward to January 1981, with all subsequent 
investments reported in constant January 1981 dollar 
terms. This method generally results in a lower total 
cost for currently producing operations. All reinvest- 
ment, operating, and transportation costs were con- 
verted to January 1981 dollars. No escalation of either 
costs or byproduct prices was included because, as- 
sumedly, any increase in costs would be offset by an 
increase in prices. 

Mine and mill operating costs were also calculated 
for each deposit. The total operating cost is the sum 
of direct and indirect costs. Direct operating costs 
include materials, utilities, direct and maintenance 
labor, and payroll overhead. Indirect operating costs 
include research technical and clerical wages, adminis- 
trative costs, facilities, and maintenance supplies and 



research. Costs for transportation and any post mill 
processing were also included. 

Other costs not included in the operating costs but 
used in the analyses include fixed charges, including 
taxes, insurance, depreciation, deferred expenses, in- 
terest payments, royalties, and return on investment. 

After capital and operating costs were deter- 
mined, the data were entered into the MAP Supply 
Analysis Model (SAM) (8). The Bureau developed 
SAM to perform an economic analysis that presents 
the results as the primary commodity price (total 
production cost) needed to provide a stipulated rate of 
return. The rate of return used in this study is the 
discounted cash flow rate of return (DCFROR), most 
commonly defined as the rate of return that makes the 
present worth of cash flows from an investment equal 
to the present worth of all after-tax investment. For 
this study, a 15-pct ROR was considered a necessary 
rate of return to cover the opportunity cost of capital 
plus risk. For some government-owned operations, a 
15-pct ROR may not be required for continued produc- 
tion. However, for comparison purposes, each deposit 
was analyzed at this rate of return. 

A separate tax-records file, maintained for each 
State and country, contains relevant fiscal parameters 
under which mining firms operate. This file includes 
corporate income taxes, property taxes, and any royal- 
ties, severance taxes, or other taxes that pertain to 
nickel production. These tax parameters are applied 
to each mineral deposit under evaluation, with the 
implicit assumption that each deposit represents a 
separate corporate entity. The SAM also contains an 
additional file of economic indices that allow for con- 
tinuous updating of all cost estimates to a base date 
(January 1981 for this study). 

Beginning with the first year of the analysis, 
detailed cash-flow analyses were generated for each 
preproduction and production year of an operation. 
After each deposit's total cost of production is de- 
termined, individual deposit tonnages are aggregated 
at increasing production costs to determine nickel 
availability from all the deposits studied. The results 
of these analyses are presented as availability curves, 
which are discussed in a later section of this report. 



NICKEL RESOURCES AND GEOLOGY 



A total of 151 deposits from 18 market economy 
countries were reviewed, with 126 of these selected 
for inclusion in this study. Appendix B lists those 
deposits not included in the study and the reason for 
exclusion. Table 4 lists the deposits for which a com- 
plete evaluation was made, and figure 4 illustrates the 
location of the deposits. Selection was limited to 
deposits having a minimum demonstrated nickel 
resource of 15,000 t of recoverable nickel and grade 
of at least 0.25 pet, which could be mined and processed 
using current technology. Exceptions for somewhat 
smaller resources, as low as 8,000 t of recoverable 
nickel, were included in the U.S. analyses owing to the 
relative importance of these deposits. The inclusion of 



deposits in the minimum grade range were selected 
arbitrarily on a deposit by deposit basis by location, 
nickel content, and byproduct content. 

For each of these deposits, a demonstrated re- 
source was estimated. A demonstrated resource is 
defined by the mineral resource classification system 
developed jointly by the U.S. Geological Survey and 
the Bureau of Mines as presented in figure 5. Demon- 
strated resources used in this evaluation include 
measured plus indicated tonnage and are defined as 
those resources whose quantity is computed from site 
inspections, drill data, and mine workings, and whose 
grade is determined from sampling. 

Information on average grades, resource ton- 



TABLE 4. — Nickel deposits evaiuated 



Ore 

Country and deposit name type' 

Australia: 

Agnew Sul 

Greenvale Lat 

Kambalda Sul 

Mt. Keith Sul 

Ora Banda Lat 

Sherlock Bay Sul 

Wannaway Sul 

Mt. Windarra-S. Windarra Sul 

Wingellina Lat 

Botswana: 

Selebi-Phikwe Sul 

Brazil: 

Barro Alto Lat 

Jussara Lat 

Montes Claros Lat 

Morro do Engenho Lat 

Morro do Niquel Lat 

Niquelandia (CNT) Lat 

Niquelandia (Codemin) Lat 

Sao Felix do Zingu Lat 

Sao Joas do Piaui Lat 

Canada: 

Birchtree Sul 

Bowden Lake Sul 

Bucko Lake Sul 

Clarabelle Sul 

Copper Cliff North Sul 

Copper Cliff South Sul 

Crean Hill Lat 

Creighton Lat 

Dumont Nickel Lat 

Expo Ungava Lat 

Falconbridge Lat 

Falconbridge East Lat 

Fraser Lat 

Frood Lat 

Garson Lat 

Key Lake Lat 

Levack Lat 

Little Stobie Lat 

Lockerby Lat 

f^/lcCreedy West Lat 

Moak Lat 

Mystery Lake Lat 

Onaping-Craig Sul 

Pipe Surface Sul 

Pipe Underground Sul 

Raglan Sul 

Shebandowan Sul 

Soab Sul 

Stobie Sul 

Strathcona Sul 

Texmont Sul 

Thompson Sul 

Totten Sul 

Colombia: 

Cerro Matoso^ Lat 

Ure district Lat 

Dominican Republic: 

Falcondo Bonao Lat 

Finland: 

Hitura Sul 

Kotalahti Sul 

Guatemala: 

Exmibal Lat 

Greece: 

Euboea Lat 

Aghios loannls Lat 

India: 

Sukinda India Lat 

Indonesia: 

Gag Island Lat 

Pomalaa (Island) Lat 

Soroako Lat 

Ivory Coast: 

Biankouma region Lat 

Madagascar: 

Ambatovy-Analamy Lat 

Valozoro Lat 

New Caledonia: 

Goro Lat 

He Art Lat 

Kouaoua Lat 

Moneo Lat 

Nakety Lat 

Nepoui Lat 

Poum Lat 



Status^ 
(1-1-81) 



Mining 
method^ 



Product 
class'' Owner name 



Map 

number 



P 

P 

P 

NP 

P 

NP 

NP 

NP 

NP 



NP 
NP 
NP 
NP 
NP 
P 
NP 
NP 
NP 

NP 

NP 

NP 

NP 

NP 

P 

NP 

NP 

NP 

NP 

P 

P 

P 

P 

P 

NP 

P 

P 

P 

P 

NP 

NP 

P 

P 

NP 

NP 

P 

NP 

P 

P 

NP 

P 

NP 

NP 
NP 



P 
P 

NP 

NP 
P 
P 

NP 

NP 
NP 

NP 
NP 
P 
P 
P 
P 
NP 



UG 

S 

UG 

S 

S 

UG 

UG 

UG 

S 

UG 

S 
S 
S 
S 
S 
S 
S 
S 
S 

UG 
UG 
UG 

S 
UG 
UG 

S 
UG 

S 

S 
UG 
UG 
UG 
UG 
UG 

S 
UG 
UG 
UG 
UG 

S 

S 
UG 

S 
UG 
UG 
UG 
UG 
UG 
UG 
UG 
UG 
UG 

S 
S 



S 
UG 



S 
UG 



Agnew Mining Corp 

Metals Exploration Ltd., Freeport Exploration. 

Western Mining Corp 

Metals Exploration Ltd., Freeport Exploration. 

Western Mining Corp 

Australian Inland Exploration Ltd 

Metals Exploration Ltd 

Western Mining Corp. -Shell Autralia 

Texas Gulf 



Matte BCL Ltd. 



Matte 
Matte 
Matte 
Matte 
Matte 

1 
1 and 2 

2 

2 



Baminco-Mineracao 

Companhia Minerada 

Vatorantin Financial Group 

Companhia do Pesquiso 

Mineracao Sartenejo S.A 

Companhia Niguel de Tocantins. 

Codemin 

Mineracao do Sul 

Rio Doce Geologica E Mines 



Inco 

Falconbridge and others . . . 
Bowden Lake Nickel Mines 

Inco 

Inco 

...do 

...do 

. ..do 

Boliden 

Expo Ungava Mines Ltd.. . . 

Falconbridge 

...do 

...do 

Inco 

...do 

Key Lake Mining Corp 

Inco 

...do 

Falconbridge 

Inco 

...do 

...do 

Falconbridge 

Inco 

.. .do 

Falconbridge 

Inco 

...do 

. ..do 

Falconbridge 

New Texmont 

Inco 

...do 



1 and 2 Econiquel-Bllliton-Hanna. 
2 Colombian Government . 



8 

9 

9 

9 

10 

8 

8 

11 

12 

13 
13 
13 
14 
14 
14 
14 
14 
14 
14 
14 
14 
14 
14 
14 
16 
14 
14 
14 
14 
13 
13 
14 
13 
13 
17 
16 
13 
14 
14 
16 
13 
14 

18 
18 



1 Outokumpu Oy 
1 ...do 



1 and 2 Larco . 
1 and 2 . . .do. 



Falconbridge 19 

20 

20 

21 

22 

22 



Tata Iron & Steel 23 



2 
2 

1 

1 
1 and 2 
1 and 2 
1 and 2 
1 and 2 
1 and 2 



P. T. Pacific Nickel 

Indonesian Government 
P, T. Inco 



24 
25 
26 



Ivory Coast Government 27 



Malagasy Government 
. . .do 



Inco 

Cofremni 

Kouaoua 

CGMC-Ballande . , 
Societe Le Nickel , 

. . ,do 

Cofremni 



28 
28 

29 
29 
29 
29 
29 
29 
29 



TABLE 4.— Nickel deposits evaiuated— Continued 



Country and deposit name 



Ore 
type' 



Status^ 
(1-1-81) 



Mining 
method^ 



Product 
class* Owner name 



Map 
number 



New Caledonia — Continued 

Poro 

Prony 

Quaco 

Ouinne 

Tiebaghi 

Thio 

Philippines: 

Acoje 

Borongan 

Dinagat 

Infanta (Ipilan) 

Makambal 

Mount Kadig 

Nonoc Mine (Surigao). . 

Rio Tuba 

Sablayan 

Santa Cruz 

Soriano 



South Africa: 

Der Brochen 

Impala (operations) 

Rustenburg (operations) 

Western Platinum (operations) 
United States: 

Birch Lake area 

Birch Lake (6 deposits) 

Brady Glacier 

Crawford Pond 

Dunka River area 

Ely Spruce 

Gasquet 

Guanijibo 

Madison 

Minnamax 

Nickel Mf 

Partridge River 

Pine Flat area 

Spruce Pit 

Red Flat 

Yakobi Island 

Zimbabwe: 

Empress 

Epoch 

Hartley 

Madziwa 

Musengezi 

Selukwe 

Shangani 

Trojan 

Wedza 



Lat 


P 


S 


1 and 2 


Lat 


NP 


S 


1 


Lat 


NP 


S 


1 


Lat 


P 


S 


1 


Lat 


NP 


S 


1 


Lat 


P 


S 


1 and 2 


Sul 


P 


8 


1 


Lat 


NP 


S 


2 


Lat 


NP 


8 


2 


Lat 


P 


S 


1 


Lat 


NP 


8 


2 


Lat 


NP 


S 


2 


Lat 


NP 


8 


2 


Lat 


P 


S 


1 


Lat 


P 


8 


2 


Lat 


NP 


S 


2 


Lat 


NP 


8 


2 


Lat 


NP 


S 


1 and 2 


Sul 


NP 


UG 




Sul 


P 


UG 




Sul 


P 


UG 




Sul 


P 


UG 




Sul 


NP 


S 




Sul 


NP 


UG 




Sul 


NP 


UG 




Sul 


NP 


8 




Sul 


NP 


S 




Sul 


NP 


8 




Lat 


NP 


8 




Lat 


NP 


S 




Sul 


P' 


UG 




Sul 


NP 


UG 




Lat 


P 


8 


2 


Sul 


NP 


8 




Lat 


NP 


S 




Sul 


NP 


S 




Lat 


NP 


8 




Sul 


NP 


S 




Sul 


P 


UG 




Sul 


P 


UG 




Sul 


NP 


UG 




Sul 


P 


UG 




SUL 


NP 


UG 




Sul 


NP 


UG 




Sul 


P 


UG 




Sul 


P 


UG 




Sul 


NP 


UG 





Societe Le Nickel 29 

Penamex 29 

Societe Le Nickel 29 

. . .do 

Cofremni 29 

Societe Le Nickel 29 

Acoje Mining Co 30 

G. Y. Ornopia and Associates 31 

Marinduque Mining Corp 31 

Philippine Government 32 

De Lara Mining Corp 32 

LBC & Greenfield Mining Corp 33 

Horizon Minerals and Oil 30 

Marinduque Mining Corp 31 

Rio Tuba Mining Co 32 

Anglo Philippine Oil Corp 30 

Benquet Consolidated 30 

Soriano Corp 32 

Platinum Pty. Ltd 34 

Impala Platinum Holdings Ltd 35 

Rustenburg Platinum Ltd 35 

Western Platinum Ltd 35 

Hanna, Inco, Duval 36 

Inco, Duval, Hanna 36 

Newmount Mining Corp 37 

Knox Mining Corp 38 

AMAX 36 

Inco 36 

California Nickel Corp 39 

Puerto Rico Government 42 

Anschutz Corp 40 

Bear Creek Mining 36 

Hanna Nickel Mining Co 41 

AMAX 36 

Hanna Mining Corp 39 

Inco 36 

Hanna Mining-Red Flat Nickel G B 41 

Inspiration Development 37 

Rio Tinto Mining 38 

Trojan Nickel Mining Ltd 39 

Rio Tinto-Anglo American 38 

Madziwa Mines Ltd 38 

Union Carbide 38 

. . .do 38 

Johannesburg Cons-Rodesia 38 

Trojan Nickel Mining Ltd 38 

Union Carbide 39 



' Sul sulfide; Lat laterite. 

^ P producer NP nonproducer. 

^ S surface UG underground. 

"Class 1 products include cathode nickel, nickel pellets, etc.; 

^ Began production in August 1982 (9-10). 

^Shut down in late 1981. 

' Past producer; now closed. 

^Temporarily closed in 1982; reopened 1983. 



class 2 products include nickel matte and ferronickel. 



nages, and physical characteristics affecting potential 
production from the deposits was obtained from 
numerous sources, inchiding independent contractors, 
Bureau of Mines files, U.S. Geological Survey and 
State publications, professional journals, industry pub- 
lications, annual reports, company lOK reports, pros- 
pectuses filed with the Securities and Exchange 
Commission, and data made available to the Bureau by 
private companies. The knowledge and expertise of 
Bureau personnel were utilized to determine each 
deposit's resource potential. 

The Bureau and the U.S. Geological Survey have 
estimated that approximately 171 million t of nickel 
is contained in the resources of market economy 
countries. This tonnage includes measured, indicated, 
inferred, and hypothetical resources. This MAP study 
evaluates deposits in market economy countries con- 



taining 73 million t of recoverable nickel at the 
demonstrated (measured plus indicated) level. Table 
5 lists these resources, by country, and figure 6 
illustrates geographic distribution and ore type of 
the resources. Nearly 30 pet of the resources are from 
sulfide ores in five countries: South Africa, Zimbabwe, 
Australia, Canada, and the United States. 

Canada has over 50 pet of the recoverable nickel 
from the sulfide deposits studied. Except for one de- 
posit in Botswana, Canadian deposits contain the high- 
est average nickel grade (1.02 pet) of the sulfide 
deposits. U.S. sulfide deposits have approximately 
three times the in situ tonnage of Canadian deposits, 
but owing to their low grade (0.19 pet), contain about 
50 pet as much recoverable nickel. South Africa and 
Australia each contain 10 pet of the total recoverable 
nickel from sulfides. All of the South African nickel 



10 




K^'i-'-" 



'■^^ j'- 






FIGURE 4.— Location map of evaluated deposits. 



Cumulatlva 
Production 


IDENTIFIED RESOURCES 


UNDISCOVERED RESOURCES 


Dtmonstrotod 


Inforrid 


Proboblllly Rongo 


Mtoturtd 


Indlcottd 


Hypothotlcol "," Spaculotlva 




ECONOMIC 






1 1 
1 1 


MARGINALLY 
ECONOMIC 






SUB- 
ECONOMIC 


1 





Otkw 
OcoirTOOCiio 



locliidoi nooeonvootioliol oM lo«-tr«4» »«t«rl«lo 



FIGURE 5. — Classification categories of mineral resources. 



is from properties whose principal recoverable com- 
modities are plantinum-group metals. Nickel is re- 
covered as a byproduct. 

Deposits in the Philippines contain 55 pet of the 
in situ laterite ore but only about 40 pet of the re- 
coverable nickel in laterites. This difference is due to 
the lower in situ grade of the Philippine deposits 
(0.72 pet) compared to the higher grade laterite 
deposits in mobt other countries. In total, the south- 
west Pacific, which consists of Australia, Indonesia, 
New Caledonia, and the Philippines, account for over 
75 pet of the recoverable nickel from laterite deposits 
and about half of the total nickel resources evaluated. 



TABLE 5. — Nickel resources by region and country 

'" ^''" °'^ Contained Recoverable 

Type of ore, region, Number of 10^t Grade, nicl<el, nicl<el, 

and country deposits pet 1 0^ t 1 0^ t 

SULFIDE ORE 

Botswana 1 38 1.03 391 171 

South Africa 4 1,020 0.26 2,652 2,086 

Zimbabwe 9 701 0.25 1,753 1,348 

Southwest Pacific: 

Australia 7 393 .73 2,869 2,104 

Philippines 1 1 .55 6 4 

Europe- Finland 2 8 .56 45 34 

North America: 

Canada 33 1,311 1.02 13,372 10,712 

United States .... 16 3,837 .19 7,290 4.450 

Total or average 73 7,309 .39 28,378 20,908 

LATERITE ORE 

Africa; Other' 4 364 1 .20 4,368 3,759 

Southwest Pacific: 

Australia 2 172 1.10 1,892 1,575 

Indonesia 3 286 1.85 5,291 3,944 

New Caledonia . . 13 940 1.65 15,510 13,700 

Philippines 11 3,131 .72 22,543 20,392 

Europe: Greece 2 230 1.10 2,530 1,877 

South America: 

Brazil 9 336 1 .45 4.872 4,31 1 

Other^ 4 152 2.20 3.344 2,088 

North America: 

United States .... 5 77 .98 755 650 

Total or average 53 5,688 1.07 61,105 52.296 

Grand total .... " 126 12,997 .69 89.483 73.204 ~ 

' Includes India, Ivory Coast, and the Malagasy Republic. 

^ Includes Colombia, the Dominican Republic, and Guatemala, 



11 



REGION AND COUNTRIES 



HTTICO 

So»rth Africo 
Zimbabwe 


— 1 — 1 — . — 1 — ■- 


r— • 7 ' 1 ' 1 ' 


— 1 ' 1 ■ 1 1 1 1 — 

KEY 
y////A Laterite 
t- 1 Sulfide 


Other 


W//////A 


Southwest Pacitic 




Austrolia 


pi 


Indonesia 


WMM 


New Caledonia 


MMMM^^^^^^^^^^^^^^^^^^ 


Philippines 


w/Mmmmmmmmmw//////A i 


Europe 

Greece 
South Americo 


WA 






Brqzil 


W//////M 


9tfier 


wm 


North America 




Canada 




'\ 


United Stotes 


w 








c 


2 4 


G 8 10 12 


14 le le 20 22 



RECOVERABLE NICKEL, lOSf 

FIGURE 6. — Geographic distribution of resources and ore 
types of evaluated deposits and properties. 




Total=73 million metric tons 



FIGURE 7.— Resources and production status of evaluated 
sulfide and laterite deposits. 



Table 6 and figure 7 illustrate the relationship 
between total resources and production status. Ap- 
proximately 24 million t of nickel or 33 pet of the total 
recoverable nickel resource occurs in producing mines. 
Nearly 14 million t is in laterite mines, mostly in the 
South Pacific region, while about 10 million t is in 
sulfides, mostly in Canada and South Africa. 



TABLE 6. — Recoverable nickel from producing mines and 
nonproducing deposits 

Producing mines Nonproducing deposits Total 

Number Recoverable Number Recoverable recoverable 

Region and nickel, nici<el, nickel, 

country lOM lOM lOM 

Africa: 

Botsw/ana 1 171 171 

South Africa. . . 3 1,958 1 128 2,086 

Zimbabwe.... 5 154 4 1,193 1,347 

Otfiers' 4 3,759 3,759 

Southwest Pacific: 

Australia 4 1,720 5 1,959 3,679 

Indonesia 2 2,732 1 1,212 3,944 

New Caledonia 8 4,811 5 8,889 13,700 

Philippines.... 4 1,652 8 18,744 20,396 

Europe: 

Finland 2 34 34 

Greece 2 1 ,877 1 ,877 

South America: 

Brazil 2 438 7 3,873 4,311 

Others^ 1 1 ,388 3 700 2,088 

North America: 

Canada 18 6,727 15 3,985 10,712 

United States^ 1 239 20 4,861 5,100 

Total 53 23,901 73 49,303 73,204 

' Others include India, Ivory Coast, and the Malagasy Republic. 
^ Others include Colombia, the Dominican Republic, and Guatemala. 
^ Includes Puerto Rico. 



SULFIDE DEPOSITS 

Nickel-bearing sulfide deposits are formed by 
several geologic processes; however, the great ma- 
jority are of igneous origin. A brief discussion of 
sulfide resources by country follows. 



Canada 



Ontario 



Figure 8 is a geological and location map of the 
Sudbury Basin District of Canada. This study included 
19 properties in the Sudbury region containing ap- 
proximately 6 million t of recoverable nickel. 

The Sudbury District in Ontario is currently the 
world's largest single producing source of nickel {11). 
It has produced approximately $21.5 billion of minerals 
over the past 95 yr. 

Geologically, the Sudbury District is within a 
Precambrian, (approximately 2-billion-yr-old) bowl- 
shaped basin. Nickel-copper mineralization may have 
taken place during norite formation. The ore is asso- 
ciated with the "nickel intrusive", also called the 
"nickel irruptive," emplaced as a mile-thick igneous 
body at an unconformity between metavolcanics and 
plutonic rocks (granites) and a Precambrian series 
of slates and quartzites called the Whitewater Group. 

Generally, nickel is in the mineral pentlandite, 
but chalcopyrite and pyrrhotite are also contributors. 
Besides the production of nickel, the district ranks 
third in the world in platinum-group metals production 
and also contributes considerable amounts of cobalt, 
copper, and silver. The bowl-shaped nature of the host 
rock allows some of the deposits on the margins to be 
mined by open pit, but most are mined by underground 
methods. The ore is primarily along the outer edge of 
an oval 32 km wide and 55 km long. 

The Sudbury District is broken into a complex 
ownership pattern between primarily two companies — 
Inco and Falconbridge. The ownership pattern and 
complexities of mining have required, in some cases, 
that companies mine from eoch other's ore on an 
exchange basis. A total demonstrated resource of 
nearly 5 million t of recoverable nickel has been 
evaluated in the district with ore grades averaging 



12 




SUDBURY 
CITY LIMITS 



LEGEND 
y Mine 
^^ Nickel irruptive 
t-.-'v -j Whitewater group 
^^^Granlte and granite gneiss 



10 

-L. 



15 



Scale, km 



^^^ Greenstones and sedimentary rocks ll 

FIGURE 8. — Geological and location map of the Sudbury District, Ontario, Canada. 



2.5 pet Co and Ni in roughly equal portions. Detailed 
information. on much of the additional resource is not 
available, owing to the lack of development drilling 
data and strict company policies relating to reserve 
values. 

Manitoba 

The Thompson District in north-central Manitoba 
is located along the boundary of the Precambrian 



Superior Province to the southeast and the Churchill 
Province to the northwest. Nickel deposits have been 
discovered along a 140-km belt, some of which have 
been developed into mines such as the Thompson, 
Pipe, Birchtree, Soab, and Mystery Lake deposits 
which produce between 1,000 and 3,000 tpd of ore. 
The majority of mining is underground using cut and 
fill and other mining methods similar to those used at 
Sudbury. Only the upper ore of the Pipe mine was 
evaluated as a surface operation. 



13 



The Thompson Belt ore bodies are generally of 
two types: (1) uniformly disseminated sulfides or 
sulfide veinlets in peridotites and (2) sharply defined 
breccia zones in metasediments. The ore bodies of the 
second type are generally higher grade (2.5 pet Ni), 
although less common. Mineralization is generally 
confined to a narrow zone of schist within a series of 
folds. Mineralization in the district has been located 
along 5,000 m of strike. As with most nickel sulfide 
ore bodies, the ore minerals of the Thompson Belt are 
pentlandite, chalcopyrite, and pyrrhotite. In addition 
to nickel, the district produces significant amounts of 
cobalt and copper. A total of 4.4 million t of recover- 
able nickel in nine properties was evaluated, approxi- 
mately 50 pet of which is recoverable from the 
Thompson and Pipe deposits. 

Australia 

Seven significant Australian nickel sulfide de- 
posits with a total recoverable resource of about 2.1 
million t of nickel were included in this study, all of 
which are Precambrian. The majority of these de- 
posits was discovered during the "nickel rush" in the 
late 1960's and early 1970's. These deposits appear to 
be nearly always associated with ultramafic rocks 
which are generally within metavolcanic belts. Nickel 
grades of the producing mines average about 2 pet, 
while nonproducing deposits average much less, about 
0.60 pet. Significant byproduct copper and lesser 
amounts of cobalt, silver, and gold are also recovered. 
Kambalda and Agnew are examples of relatively large 
producing nickel mines using highly mechanized min- 
ing techniques. All but one deposit were evaluated as 
underground operations. Australia contains 2.1 million 
t or 10 pet of the total recoverable nickel from sulfides 
and 3 pet of the total recoverable nickel included in 
this study. 

South Africa 

The Republic of South Africa is the world's 
largest supplier of platinum, accounting for 65 pet of 
world production in 1980 and about 45 pet of PGM 
production in 1981. In addition to platinum group 
metals, nickel and copper are recovered. Nearly all of 
South Africa's nickel is derived from operations on 
the Merensky Reef of the Bushveld Igneous Complex, 
the largest known layered magmatic sequence in the 
world, occupying an area of 68,000 km. The Merensky 
Reef is nearly continuous throughout the entire com- 
plex. Platinum-group metal grades average about 0.25 
oz/t, with platinum constituting 61 pet and palladium 
26 pet of total PGM content. Nickel and copper grade 
about 0.26 pet each. 

Four separate Merensky Reef mining areas are in- 
cluded in this study. They account for 3 pet of the 
total world nickel resources evaluated and 10 pet of the 
recoverable nickel from sulfides (approximately 2.1 
million t of recoverable nickel). Three of these areas 
— Rustenburg, Impala, and Western Platinum — are 
currently producing and account for virtually all of 
South African nickel production from the Reef. The 
fourth deposit, Der Brochen, is undeveloped. Produc- 



tion is dominated by Rustenburg, which accounted 
for 56 pet of total South African platinum output in 
1979. Impala accounted for 41 pet and Western 
Platinum supplied the remaining 3 pet. Approximately 
30,000 tpy of nickel is currently produced from South 
Africa, part of which is refined in Norway. 

Because of the highly regular and predictable 
nature of the dip, strike, thickness, and grade of the 
ore-bearing interval, the Merensky Reef is mined by 
simple, conventional stoping methods. This allows for 
large areas of relatively shallow deposits adjacent 
to producing mines to be brought into production 
in less than a year. Consequently, production and 
development rates can respond quickly to changes 
in platinum price and demand; a corresponding in- 
crease in byproduct nickel production will also occur. 

Zimbabwe 

The Great Dyke of Zimbabwe includes four 
separate igneous complexes containing large quanti- 
ties of platinum in association with palladium, 
nickel, and copper. The names of the complexes are 
Hartley, Selukwe, Wedza, and Musengezi. Platinum- 
group metals and byproducts of the Great Dyke occur 
in a 30-in-thick interval. Mineralogically similar to 
the Merensky Reef of the Bushveld Complex, the 
interval is generally continuous in all four com- 
plexes. The PGM-bearing interval averages 0.25 pet 

Ni, 0.25 pet Cu, and from 0.10 to 0.16 oz/t of com- 
bined platinum and palladim. The four complexes 
together contain a demonstrated recoverable resource 
of about 85 million oz of platinum and 1.2 million 
t of nickel. 

Currently, there are no major platinum or 
nickel mining operations on the Great Dyke, but 
production potential is significant. The four proper- 
ties were included in this study owing to the large 
nickel and coproduct metal resources which have 
attracted considerable interest from industry. An 
experimental mine, the Mimosa, was established 
in the Wedza Complex and produced during 1970, 
1971, and from 1976 to 1978. A second test operation 
started in 1980 at Rio Tinto's Zinca Prospect in 
the Hartley Complex. Development drilling continued 
through 1981, with a test mine shaft and pilot plant 
completed during 1982. Mine production rates in this 
study were modeled to existing chromite operations 
on the Great Dyke, while processing procedures were 
modeled after nickel-producing platinum operations 
in South Africa. It has been assumed that the con- 
centrate would be smelted in Zimbabwe, with the re- 
sulting PGM-bearing nickel matte refined primarily 
in Norway. PGM refining would be in Zimbabwe. 

The Empress, Trojan, and Epoch underground 
mining operations are contained in Precambrian 
greenstones and basalts in the south-central part of 
the country. Mineralization is generally in the form 
of disseminated to massive pentlandite with pyrrho- 
tite and chalcopyrite. These properties contain nickel, 
copper, and cobalt; minor amounts of PGM's are also 
recoverable from some of the properties. There have 
been considerable engineering as well as political 
problems associated with mining these deposits. 



14 



Botswana 

The Selebi and Phikwe deposits are mined as one 
operation. These mines are the only Botswana nickel 
producers and are important contributors of nickel 
matte to AMAX's Port Nickel refinery in the United 
States. The ore bodies are hosted in Precambrian 
mafic and ultramafic rocks. The host rock for most of 
the mineralization is disseminated to massive pyrrho- 
tite, chalcopyrite, and pentlandite contained in an 
amphibolite sill. Besides nickel, the properties pro- 
duce byproduct cobalt and copper. Surface operations 
were discontinued in 1980 and only the underground 
operations remain. Approximately 2.3 million t of ore 
were mined in 1981 at an average grade of about 
1.0 pet Ni and 0.82 pet Cu. 

United States 

The Duluth Gabbro Complex is one of the 
world's largest basic igneous intrusions and contains 
the largest known sulfide nickel resource in the 
United States. The intrusion covers an area greater 
than 1,200 km^ in northeastern Minnesota and con- 
tains an estimated 4.2 million t of potentially re- 
coverable nickel. This Precambrian intrusion con- 
sists generally of strongly layered gabbros. 
Mineralization is the result of magmatic differentia- 
tion during the crystallization process. The principal 
nickel mineral is pentlandite and copper minerals 
are chalcopyrite and cubanite. Minor amounts of 
cobalt and PGM's are also present. 

Birch Lake, Dunka River, Ely Spruce, Partridge 
River, and Minnamax are properties that have at- 
tracted interest from AMAX, Inco, and other com- 
panies. Most properties are in various stages of 
exploration programs (drilling, magnetic surveys, 
small test pit, outcrop sampling, etc.) ; however, the 
Ely Spruce and Minnamax deposits have had extensive 
exploration work, including drilling programs, large 
test pits and exploration shafts, and removal of large 
bulk ore samples for metallurgical testing. None of 
these properties are producing. Most would likely be 
mined by open-pit methods except Minnamax, where 
underground mining is proposed. 

Environmental problems may prevent or delay 
exploitation despite interest in development. The 
Duluth Gabbro Complex extends into the Boundary 
Waters Canoe Area (BWCA), a federally established 
wilderness area, and proposed mining operations are 
within a few miles of the southwest boundary of this 
wilderness. Precautions to ensure water quality and 
limit air emissions will be necessary to ensure ade- 
quate protection of the BWCA. Very stringent air and 
water quality requirements in this area require that a 
smelting and refining complex be located some distance 
away. In addition to environmental issues, social pres- 
sures and depressed nickel markets have complicated 
development. 

Brady Glacier and Yakobi Island deposits, in 
Alaska, are also associated with ultramafic intrusives. 
Brady Glacier is a vertically oriented cylindrical de- 
posit, containing primarily disseminated pentlandite 
with chalcopyrite and cubanite. There has been sig- 



nificant exploration work on these properties, and 
some preliminary mining plans were determined, but 
development in the near future appears unlikely owing 
to an outlook of relatively low metal prices and en- 
vironmental issues associated with .these deposits. For 
example, the Brady Glacier deposit is under a glacier 
in Glacier Bay National Monument. A total resource 
of nearly 4.5 million t of recoverable nickel from sul- 
fides in the United States was estimated in this study. 



LATERITE DEPOSITS 

In order for nickel-bearing laterites to develop, 
subtropical to tropical climatic conditions must have 
existed. Laterites are widespread and presently repre- 
sent the largest land-based source of nickel. Nickel 
laterites result from a gradual decomposition of ultra- 
basic rocks, particularly peridotites, in which nickel, 
for the most part, is contained in the mineral olivine. 

Laterite ores are formed by the combined action 
of mechanical and chemical weathering. As nickeli- 
ferous olivine decomposes, nickel is released and 
mobilized into solution by the downward percolation 
of rainwater and/ or the movement of groundwater. 
Nickel is redeposited at depth by precipitation. This 
repeated action, known as lateritization, results in a 
"zone of enrichment" which, in some cases, can be 
mined at a profit. Saprolite, the lowermost lateritic 
zone, overlies the parent rock. 

There are two divisions of lateritic nickel ores, 
primarily siliceous and limonitic. The silicate ores 
(garnierites) contain less than 30 pet Fe, about 30 
pet SiOs, and a high nickel grade, generally exceeding 
1.5 pet Ni. Garnierite laterites are desirable for 
ferronickel production owing to their high SiOa and 
MgO content. The minable laterite ores of Indonesia, 
Oregon, New Caledonia, and some Philippine ores fall 
into this general classification. Iron-rich limonitic 
laterites form when the leaching of nickel is not as 
favorable or complete as with the garnierite laterites, 
resulting in a mixed iron-nickel zone. Limonitic ores, 
which occur throughout much of the world, are rela- 
tively rich in iron, containing approximately 45 to 55 
pet Fe, and about 1.0 pet Ni. Limonitic ores are 
amenable to hydrometallurgieal processing methods, 
which produce a nickel matte or, in some cases, a 
nickel metal. Most of the laterite deposits of Guate- 
mala, Indonesia, and the Philippines fall into this 
category. 

The distinction between the two types of laterite 
ores is clear; however, because of various degrees of 
lateritization, field classification is often subjective. 
In some cases, a layered ore body containing limonitic 
material overlying garnieritie ore is mined and the 
overlying limonitic material is stockpiled for later 
processng. 

A brief description of the major laterite deposits 
in important nickel producing countries follows. 

New Caledonia 

The New Caledonia laterites were first discovered 
by James Gamier in 1865. Garnieritie laterite was 



15 



mined beginning in 1875 and continues to this date. 
The ore grade has declined from 10 pet Ni to about 
2.5 pet because of removal of the higher grade ore. 

Laterites cover a third of New Caledonia's 19,000 
km2 to an average depth of about 20 m. The deposits 
resulted from the weathering of Oligocene peridotites, 
primarily harzburgite and dunites. Although both 
limonitic and garnieritic (saprolites) laterites exist 
on the island, only garnieritic ores are presently mined. 
The primary product for these ores is ferronickel 
which is produced from SLN's Doniambo ferronickel 
plant. Thirteen properties, including Nakety, Poro, 
and Nepoui, were evaluated in this study; together 
they contain a nickel resource of approximately 13.7 
million t of recoverable nickel. The New Caledonian 
laterites contain approximately 25 pet of the total 
recoverable nickel in laterites evaluated in this study. 

Philippines 

Philippine laterites are developed on Cretaceous 
ultramaphics. The laterite profile consists of three 
zones: overburden, limonitic laterites, and saprolites. 
Nickel content of the ores ranges from about 0.4 pet 
to about 2.1 pet. A well-developed laterite profile is 
developed throughout most of the islands underlain 
by ultramafics. Ore bodies average about 25 ft thick 
and are mined by surface methods using shovels and 
trucks. 

Depending on the chemical nature of the ore, 
either ferronickel or nickel and cobalt can be produced. 
Much of the low iron ore (saprolites) is dried and 
shipped to Japan for ferronickel production, while the 
high iron ore (limonitic), containing up to 0.2 pet 
Co, is processed locally to recover nickel and cobalt. 
Marinduque Mining and Industrial Corp. operates a 
reduction-roast ammonium carbonate leach refinery to 
recover nickel and cobalt on Nonoc Island. Owing to 
problems with the extraction process and labor avail- 
ability, 24,000 tpy of nickel is produced, only 65 pet 
of design capacity. Total recoverable nickel from the 
Philippine deposits evaluated is approximately 20.4 
million t, only 8 pet of which is from producing 
operations. 

Indonesia 

The laterites of Indonesia, more specifically the 
island of Sulawesi, have been explored extensively. 
Laterite deposits range from 5 to 30 m in thickness 
and developed as a result of weathering of Cretaceous 
ultramafic complexes. Studies have indicated that to 
develop a laterite profile of the type found on Sulawesi 
would require 1 to 5 million yr. 

Indonesia contains approximately 7 pet of the 
total recoverable nickel from the laterite deposits 
studied. Both garnierites and limonitic laterites are 
found on the island. Garnierites contain about 2.5 pet 
Ni and are processed to ferronickel. The limonitic ore 
averages between 0.5 and 1.5 pet Ni. 



Greece 

The nickel laterites of Greece are developed on 
Cretaceous ultrabasic rocks. Although primarily high 
iron laterites, some garnierites are also mined. The 
average nickel content of the ore ranges between 1 
and 1.5 pet Ni with recoverable cobalt and iron as by- 
products. There are generally two areas of laterite 
mining, the island of Euboea, northeast of Athens, 
and Aghios loannis, located northwest of Athens. 
Combined, the properties contain approximately 1.9 
million t of recoverable nickel, which is mined using 
surface and underground methods. The surface opera- 
tion uses standard shovel and truck methods, while 
underground mining is accomplished using cut and fill 
and mechanized ore haulage. 

Dominican Republic 

The laterites of the Dominican Republic are de- 
veloped on Cretaceous through Eocene serpentinized 
peridotites. Lateritization appears to have begun dur- 
ing the Miocene period and continued for about 20 
million yr. Deposits measure up to 60 m thick and are 
strongly zoned. Minable ore zones are about 1.2 pet Ni 
and measure about 8 m thick. There is a waste-to-ore 
stripping ratio ranging between 6:1 and 11:1. 

Three zones of ore are currently blended to 
produce ferronickel, each reflecting different composi- 
tions. The zones range in grade from about 0.5 pet 
to 3 pet Ni. The ultramafic host rock assays about 0.3 
pet Ni and is sometimes mined for garnieritic frac- 
ture fillings in the bedrock. Limonitic ore near the 
surface is up to 20 m thick, with nickel grades of 
approximately 1.2 pet. This ore has the highest iron 
content of the three zones, about 35 pet. The middle 
ore, a limonitic laterite with serpentine, grades about 
1.5 pet to 2.0 pet Ni and about 15 pet Fe, and measures 
up to 16 m thick. The third and deepest zone consists 
of soft and hard serpentine, serpentinized peridotite, 
and ultramafic rock and is low grade, about 0.5 pet Ni. 

Australia 

Three laterite occurrences were evaluated in Aus- 
tralia. Greenvale, located in northeast Queensland, 
consists of three main zones developed on Ordovician 
ultramafic country rock. The uppermost zone consists 
of overburden of clay and other detritus; the middle 
zone is a limonitic laterite about 5 m thick averaging 
about 1.5 pet Ni and Co combined; the lower zone is 
composed of highly weathered rock containing up to 5 
pet Ni. The lower and middle zones are mined using 
draglines, shovels, and trucks. 

The Ora Banda laterite in Western Australia is 
currently mined using surface methods. The laterite is 
used primarily as flux in the Kalgoorlie smelter and 
contains about 1 pet Ni. 

Wingellina, a relatively high grade occurrence, is 
located on the borders of Western Australia, South 



16 



Australia, and the Northern Territory. Although 
exploration programs have been carried out, no sig- 
nificant development work has taken place. 

United States 

The laterites evaluated in the United States 
account for 1.2 pet of total recoverable nickel from 
laterites and less than 1 pet of total market economy 
recoverable nickel from all properties studied. Approxi- 
mately 650,000 t of recoverable nickel was evaluated 
among the four nickel laterite deposits. All evaluated 
domestic laterite deposits are in California, Oregon, 
and Washington. They were formed by weathering of 
ultramafic, often serpentinized, peridotite bodies. 
Garnierite is the principal nickel mineral. The Nickel 
Mountain Mine near Riddle, OR, recently closed, was 
the only producer in the area. The Gasquet deposit 
in northwest California has had extensive exploration 
and some initial development and feasibility programs. 
Production was originally scheduled to begin in the 
spring of 1982 but difficulty in acquisition of capital 
has caused delay. 

Surface mining methods (surface cuts) are or 
would be used to extract the ore from these deposits. 
Proposed annual ore capacities range from 640,000 to 
1.6 million t, with operational schedules of 300 to 350 
days per year. 

Potential environmental problems associated with 
laterite ore are relatively short term but do present a 
potential problem for development. 



Other Countries 

Other laterites evaluated in this study are located 
in Brazil, Colombia, Guatemala, India, the Ivory Coast, 
and the Malagasy Republic. These laterite resources 
are mostly undeveloped although producing mines are 
located in Brazil (2) and Colombia (1). The laterites 
in these countries result from the weathering of ultra- 
mafic complexes. The deposits are generally 5 to 30 m 
thick and have iron contents of 10 to 25 pet and nickel 
grades of about 1 pet. Some deposits have cobalt 
grades high enough to be recoverable. 

IMANGANESE NODULES 

Significant nickel resources occur in deep seabed 
nodules, also known as manganese nodules. These 
nodules occur on large areas of the ocean floor from 
300 to 9,000 m below sea level. The highest concen- 
trations occur in the central East Pacific ocean be- 
tween 5° and 20° north latitude and 110° to 160° west 
longitude. Resource estimates range between 27 million 
to 39 billion t of nickel along with cobalt, copper, 
gold, manganese, and silver (2, 12). Mining and lift- 
ing systems have been tested at one-fifth and one- 
tenth scale, however technologies for mining and 
recovery are preliminary. Hydrometallurgical and 
pyrometallurgical treatments have been extensively 
investigated. Within the context of this study, sea- 
bed nodules are considered a resource for future 
exploitation and are not included. 



MINING AND PROCESSING TECHNOLOGIES 



The nature of the geologic occurrence of sulfide 
and laterite ores usually dictates underground mining 
for sulfides and surface mining for laterites. In addi- 
tion, differences in ore chemistry require different 
processing methods to produce a final marketable 
product. Following is a brief discussion of the mining 
and processing methods for sulfide and laterite ores. 
Mining and processing costs are discussed in a later 
section. 



SULFIDE TECHNOLOGIES 

The majority of nickel sulfide ores are taken 
through four basic steps in order to recover nickel 
and associated coproducts and byproducts; mining, 
beneficiation, smelting, and refining. In some cases, 
concentrates from the beneficiation step can be 
processed by hydrometallurgical methods, making 
smelting unnecessary in order to recover metals. 

Mining 

The mining of nickel sulfide ore is accomplished 
by both surface and underground methods. Surface or 



open-pit mining is based on standard engineering 
practices using power shovels and trucks and does not 
usually present any special conditions. About 20 pet 
of the recoverable nickel from sulfides is or would 
likely be mined by surface methods. The Pipe Surface 
Mine in Manitoba, the Clarabelle Mine in Ontario, 
and the proposed mining operations for Birch Lake, 
Minnesota, are representative examples. 

Approximately 80 pet of the sulfide resource is or 
would likely be mined by underground methods. The 
Sudbury District is representative of many types of 
underground mining techniques; nearly all of the 
mining methods used worldwide are employed at 
Sudbury. Many of these mining methods, especially 
bulk mining techniques, were first developed in the 
Sudbury District by Inco engineers. Vertical Crater 
Retreat (VCR), mechanized undercut and fill, and 
large-diameter underground blasthole mining are 
methods perfected by Inco at Sudbury. Falconbridge 
Mines, also very active in the Sudbury District, has 
developed efficient mining operations utilizing radio- 
remote-controlled, load-haul-dump units (LHD's). 
Mining costs for underground operations are generally 
very expensive and are a major component of the total 
cost to recover nickel from sulfide deposits. 



17 



Beneficiation 

Beneficiation of sulfide ores is generally more 
complicated than laterites. Sulfide ore is often crushed, 
ground in ball or rod mills, and floated. Magnetic 
separation may precede flotation. The flotation cir- 
cuits, depending upon the complexity of the ore, may 
be designed to recover high nickel-copper and/ or high 
copper-nickel concentrates. Nickel recoveries average 
about 90 pet, and concentrate grades average approxi- 
mately 12 pet. Pyrrhotite may also be recovered as a 
separate concentrate. The various concentrates may 
contain, depending on the ore content, variable 
amounts of cobalt, gold, silver, and platinum-group 
metals. 

Pyrometallurgical Post-Mill Processing 

Nickel sulfide concentrates can be further proc- 
essed to a matte in three stages; roasting, smelting, 
and converting. Roasting is applied to concentrates 
which contain more iron than nickel and serves as a 
preparatory step to smelting. Roasting is accomplished 
by heating the concentrate in an oxygen-enriched 
atmosphere which results in the oxidation of the con- 
tained metal sulfides and in the removal of up to 50 
pet of the sulfur. Roasting also preheats the material 
prior to smelting. 

Most smelting of a roasted concentrate takes place 
in flash smelters and/or in electric furnaces. The term 
"smelting" refers to melting of the ore or concentrate 
under conditions that produce a separation of the 
desired metal and other constituents. The flesh smelt- 
ing process entails the injection of concentrate and 
flux with oxygen or preheated air into a furnace 
chamber. The term "flash" is derived from the high 
heat-producing reaction between the furnace at- 
mosphere, iron, and sulfur. 

Electric furnace smelting operates by passing an 
electrical charge through the feed concentrate. The 
resistance created produces heat, thus smelting the 
material. The energy-intensive nature of this method 
often requires a low cost energy source, such as 
hydroelectric power, to remain cost competitive. 

Conversion is the process by which remaining 
iron and sulfur are oxidized in order to eliminate 
residual iron sulfide. Conversion of the matte is gener- 
ally carried out in Pierce-Smith converters, combining 
heat and an oxygen-enriched atmosphere. Mattes con- 
tain about 50 pet nickel and recover about 90 pet of 
the nickel contained in the concentrate. The matte may 
then be cast into anodes for electrolytic refining to 
nickel metal. Recovery of other constituent metals may 
be accomplished by processing the slimes resulting 
from the electrolytic process. 

Hydrometallurgical Post-Mill Processing 

Hydrometallurgical methods have become im- 
portant and widely accepted in the extraction and 
recovery of nickel and byproduct metals from nickel 
sulfide concentrates. The principle aim of a hydro- 



metallurgical method is to selectively leach the desired 
metals into solution. Ammonia is most desirable as a 
leaching agent because of its selectivity of leaching 
nickel, copper, and cobalt while not reacting with 
carbon steel equipment as do acid leach solutions. The 
ammoniacal pressure leaching process was first de- 
veloped on a commercial scale by Sherritt Gordon at 
its Fort Saskatchewan refinery in Alberta, Canada. 
This hydrometallurgical process can be used directly 
on primary nickel, copper, and cobalt sulfide concen- 
trates, eliminating in most cases the need for the 
roasting stage of processing. 

Concentrates with a high arsenic content require 
roasting before leaching. Leaching is carried out in a 
solution of ammonia and oxygen in water starting 
with an ammonia pressure-leach process at 70° to 90° 
C and at 100 to 150 psi. Nickel, cobalt, and copper are 
converted to soluble ammines; iron is converted to an 
insoluble hydrated ferric oxide; and the sulfur is 
oxidized to various soluble sulfur-oxygen ions. Metals 
dissolved in the leach solution are then individually 
separated. The solution is heated to boil ofl? free 
ammonia, and a copper sulfide precipitate is formed 
and later refined. The pregnant solution is then 
treated in an "oxydrolysis" autoclave to convert un- 
saturated compounds into ammonium sulfate. Nickel 
and cobalt are separately precipitated out of the solu- 
tion in an autoclave with an atmosphere of hydrogen 
at 500 psi. The nickel powder (precipitate) is rolled to 
form nickel strip, and the cobalt is marketed as pow- 
der. The remaining ammonium sulfate, recovered by 
evaporation as ammonium sulfate crystals, is marketed 
as Sherritt ammonium sulfate fertilizer. 

Despite the highly effective nature of the system, 
high energy requirements, process control, and ef- 
fluent cleaning result in relatively high costs. 

Refining of Nickel 

Electrowinning, electrorefining, and a vapometal- 
lurgical process are techniques used for refining nickel 
into a high-purity metal. Electrowinning is a process 
for recovering a metal previously dissolved in an elec- 
trolyte. An electric current passing through the solu- 
tion causes the metal to deposit on a cathode. Some- 
times this impure metal must be purified in an electro- 
refining step. 

Electrorefining of nickel anodes is accomplished 
by placing the anodes in a cell or tank containing an 
electrolyte solution. An electric current dissolves the 
anodes and causes them to plate on cathodes. Im- 
purities collect in the sludge and are periodically 
removed and processed further to recover other prod- 
ucts including precious metals. 

The vapometallurgical process, or carbonyl gas 
process, utilizes impure metallic nickel granules as 
feed. These granules are fed into a rotating carbonyl 
reactor and converted to nickel-iron carbonyl vapor by 
heating at 50^^ to 80° C in a high-pressure Co at- 
mosphere. The vapor is condensed to a nickel iron 
carbonyl liquid which is decomposed to high-purity 
nickel. 



18 



LATERITE TECHNOLOGIES 

Laterites are usually mined by conventional sur- 
face methods. Post mine processing is dictated by the 
chemistry of the ore, either limonitic or garnieritic, 
which also dictates the product, either ferronickel, 
matte, or nickel metal. 

Mining 

Most laterite deposits are mined by open cut and 
modified open-pit methods. The soft nature of most 
laterite ores allows for mining with power shovels, 
draglines, front-end loaders, and bulldozers with a 
minimum of blasting. Laterite mining operations 
strongly resemble simple earth-moving operations. A 
major problem associated with mining laterites is the 
high percentage of moisture content, up to 30 pet in 
the ore. This high moisture adds additional weight 
and significantly reduces equipment traction and 
ground support, thus predicating the size of equip- 
ment. Other problems are related to removal of bould- 
ers, maintaining grade control because of zonation of 
ore bodies, and mining difficulties associated with 
topography. 

Underground mining of laterites is rarely under- 
taken owing to ground support problems and asso- 
ciated higher operating costs. An exception is the 
Hagios loannis Mine in Greece, an active underground 
laterite operation. Approximately 450,000 tpy of ore 
is produced from this mine using cut-and-fill mining 
and highly mechanized ore haulage. 

Post-IMine Processing 

The selection between hydrometallurgical and 
pyrometallurgical treatment of laterite ores is dic- 
tated largely by the composition of the ore. The 
primary criteria is the Mg:Fe ratio. Ores in the 
limonitic zone are treated by hydrometallurgical meth- 
ods, and the garnierites are treated by pyrometal- 
lurgical methods. Processing of a transition zone 
material, using either method, can create problems in 
recovery of metals and result in higher energy costs. 

Pyrometallurgical Methods 

The major pyrometallurgical methods consist of 
direct reduction to ferronickel and smelting to a nickel 
matte". Each method is briefly discussed in the follow- 
ing sections. 

Ferronickel Production 

At least 80 pet of laterites presently mined are 
processed to ferronickel. Ferronickel production gen- 
erally consists of the following steps : (1) drying, (2) 
calcining, (3) smelting, and (4) refining. 

Drying the ore consists of loading the wet laterite 
ore into rotary dryers, which reduce the moisture 
content by more than half (typically 30 pet down to 5 
pet). After the ore is dried, crushing and screening 
can be accomplished. From the crushing and screening 
plant, the ore is fed to caleiners to remove or decom- 



pose carbonates and moisture. The hot calcine is trans- 
ported to the smelter and is fed, along with reducing 
agents, to melting furnaces to produce ferronickel. 
Following smelting, the molten ferronickel is fed to 
refining furnaces for dephosphorizing and deoxidizing. 
A final ferronickel composition could assay 36 pet 
Ni and 62 pet Fe, with the remainder composed of 
Co, S, C, and Si. Approximately 90 pet of the nickel 
contained in the ore is recovered. The U.S. producer 
manufactures a somewhat higher nickel grade ferro- 
nickel than other countries. Ferronickel produced from 
Nickel Mountain, OR, generally assayed 49 pet Ni, 51 
pet Fe, and 0.5 pet Co, SiOz, and other impurities (IS) . 

Matte Production 

A relatively small amount of laterite ore is 
processed to a nickel sulfide matte. The matte forming 
process consists of smelting a charge composed of ore, 
coke, and limestone and a sulfur source, usually 
gypsum. This process results in an iron-contaminated 
nickel sulfide matte which is refined in a converter to 
remove the iron and sulfur. The refined nickel sulfide 
matte assays approximately 75 pet Ni and 25 pet S 
with some impurities. This process is used on portions 
of New Caledonian ores, on Indonesian ores, and on 
Guatemalan ores at Exmibal. The sulfide nickel matte 
is sent to a refinery for further processing into nickel 
metal and its associated recoverable byproducts such 
as cobalt and copper. 

Hydrometallurgical Methods 

Limonitic ores and some mixed laterites with low 
magnesia and silica content are amenable to processing 
by hydrometallurgical methods. There are two pri- 
mary methods for processing these ores: (1) re- 
duction roasting followed by ammoniacal leaching, 
and (2) sulfuric acid leaching. 

The ammoniacal leaching process consists of dry- 
ing, grinding, reducing in multiple hearth roasters, 
ammonia carbonate leaching, separating of cobalt, 
precipitating nickel carbonate, and recovering am- 
monia. The nickel carbonate precipitate is then cal- 
cined to produce a nickel oxide. The roast-reduction 
ammonia leaching process is used on the Greenvale, 
Australia, laterite ore. The final nickel product aver- 
ages about 90 pet Ni with an estimated 75-pct overall 
recovery. The ammoniacal method is used at Green- 
vale, Australia, and at operations in the Philippines. 

The sulfuric acid leaching process does not re- 
quire drying. The wet ore is pumped to leaching tow- 
ers where it is contacted with high temperature sul- 
furic acid. Nickel, cobalt, and magnesium are 
dissolved and then precipitated by the addition of 
gaseous HlS. The resulting concentrate is sent to a 
refinery where it is dissolved through a series of pre- 
cipitation and dissolution steps, and refined metals 
(i.e., nickel, copper, and cobalt) are recovered. Nickel 
sinter and metal are produced. An overall nickel 
recovery of 60 to 90 pet of the nickel in ore is usually 
obtained. The sulfuric acid leach process is presently 
being used at the Moa Bay operation in Cuba. 



19 



NICKEL PRODUCTION COSTS 



Operating and capital costs in this study are based 
on actual data or are estimated by comparison with 
those for similar mining operations. The average total 
cost calculated for each of the deposits analyzed must 
cover mining, concentrating, smelting, and refining 
operating costs, transportation costs, capital recovery, 
taxes, and profit. These costs often vary greatly de- 
pending on such factors as size of operation, mining 
method, deposit location, stripping ratio, depth of ore 
body, grade of nickel and byproducts, processing 
losses, energy and labor costs, and country tax struc- 
ture. 

The operating costs presented in this section are 
weighted averages based on costs per metric ton of 
ore and per pound of nickel over the life of the opera- 
tion. Capital costs reflect the total investment required 
for those deposits not producing at the time of the 
study to develop the mine, construct all facilities, and 
begin production. Capital costs for producing mines 
are not shown because some of the mines have been 
producing for many years and a large portion of the 
initial cost has been depreciated. 



OPERATING COSTS 



opportunity. Exceptions to this shift are State-owned 
cr controlled mines, which may continue producing at 
or below the "break even" market price if the result- 
ing losses are less than those incurred if the mine 
were closed. A closure may require payment of unem- 
ployment and welfare benefits or loss of training, etc. 
Governments also may require the sales revenue gen- 
erated by the mine in order to purchase other needed 
materials. 

Total cost is defined as the net operating cost plus 
the cost of recovery of capital and a profit on all in- 
vestments at a 15-pct DCFROR. Total cost can be 
compared to a long-run market price and indicates 
which properties have suflScient return of and on 
capital to provide an incentive to produce. For pro- 
ducing mines in some countries, no great difference 
exists between the net operating cost and the total 
cost because most of the mines have been producing 
for a long enough time that a large portion of the 
capital has been amortized. For other producing mines 
in other countries and for nonproducing deposits, the 
difference is significant because relatively large 
amounts of capital remain to be amortized. 

Producing Sulfides 



Operating costs for producing and nonproducing 
sulfide and laterite operations, expressed as dollars per 
metric ton of ore and per pound pound of nickel pro- 
duced, are discussed in this section. Costs presented 
are averages for the deposits in individual countries; 
specific deposit costs may vary greatly from the coun- 
try average. Costs for mining, milling, smelting and 
refining, and taxes have been calculated along with 
credits for byproducts. Costs are shown for surface 
and underground mines by country. For producing 
laterite deposits only one underground mine was 
studied; costs for this operation are not shown in 
order to maintain confidentiality. Beneficiation costs 
for sulfides include the cost of recovery for all com- 
modities by flotation. In the case of laterites the mill 
cost includes drying, calcining, and other steps to 
produce ferronickel or the steps required to produce 
refined nickel. Transportation costs, royalties, and 
post-mill processing for nonnickel commodities are 
included in the smelter and refinery costs. "Taxes" 
include all property, severance, state or provincial, 
and federal taxes. Revenues from coproduct and by- 
product commodities have also been computed and 
subtracted from "total operating cost" in order to 
determine "net operating cost." 

Net operating cost is the average cost of produc- 
tion not including recovery of capital or profit. It can 
be compared to the average nickel price in which the 
mines of each country could "break even" by covering 
all production costs. A company may be willing to 
operate at or below this price temporarily if the com- 
pany projects the situation will improve in the near 
future. However, if the company's outlook is bleak, it 
may temporarily discontinue operations or permanent- 
ly close and shift its investment to a more profitable 



Tables 7 and 8 illustrate costs associated with 
production of nickel on a per metric ton of ore and per 
pound of nickel basis, respectively. The weighted 
average mining cost for producing surface sulfide 
operations is $l/lb Ni or about $19.80/t of ore. Cost 
differences for individual surface mines are due large- 
ly to variations in stripping ratios, productivity, ore 
grade, and energy and labor costs. 

Producing underground sulfide mine costs range 
from $0.80/lb Ni ($23/t of ore) in Canada to $3.85/lb 
Ni ($12.05/t of ore) in South Africa. The lower 
Canadian cost on a per-pound basis reflects the higher 
grade of nickel (approximately 0.9 pet Ni). Although 



TABLE 7.— Estimated mine and mill operating costs for 

producing nicl<el mines 

(January 1981 dollars per metric ton of ore) 

Average 
Number Average annual ore 
Ore type, type of operation, of ore feed capacity, Mine Mill 

and country mines grade, pet 10^ t cost cost 

SULFIDE 
Surface 6 1.10 612 $19.80 $4.00 

Underground; 

Canada 15 .90 1,017 23,00 4.30 

South Africa 3 .25 10,560 12.05 2.55 

Zimbabwe 4 .60 675 18.60 3.35 

Average of underground 19 .89 945 22.80 4.25 

cost' 

LATERITE 
Surface: 

New Caledonia 8 2.50 416 18.00 NAp 

Philippines 3 1-50 1,700 3.55 NAp 

Central and South 

America^ 4 1.50 1,102 8.05 NAp 

A verage 15 1.90 856 1 1 .20 NAp 

NAp Not applicable, included in smelter-refinery cost. 

' Does not include South Africa. 

2 Includes Dominican Republic, Guatemala, and Brazil. 



20 



TABLE 8. — Estimated production costs for producing nicltel mines in selected countries 
(January 1981 dollars per pound of nicltel) 

Smelter- Total Net Total cost 

Number of Mine Mill refinery operating Byproduct operating including a 

Ore type, type of operation, and country mines cost cost cost cost' Taxes^ credits cost^ 15-pct ROR* 

SULFIDE 
Surfaced 6 $1.00 $0.20 $1.00 $2.20 $0.05 $0.40 $1.85 $1.95 

Underground: 

Canada 

South Africa* 

Zimbabwe 

Average' 

LATERITE 
Surface: 

New Caledonia 

Philippines 

Central and South America^. . . . 

Average 15 .30 ^NAp 3.30 3.60 .10 .10 3.60 4.15 

NAp Not applicable. 

' Summation of mine, mill, smelter, and/or refinery, and miscellaneous cost. 

^ Includes property, severance, state, provincial, and Federal tax where applicable. 

^ Total operating cost plus taxes less byproduct credits. 

" Total operating cost plus recovery of capital and profit at a 15-pct ROR. 

^Average of surface operations in Canada (3), Finland (1), Philippines (1), Zimbabwe (1), 

* South African mines produce PGM's as primary commodities. 

'' Does not include South Africa. 

° Post-mine processing of laterites is included in smelter-refinery cost. 

^ Includes Dominican Republic, Guatemala, and Brazil. 



15 


.80 


.15 


1.35 


2.30 


.05 


.75 


1.60 


1.75 


3 


3.85 


.80 


5.05 


9.70 


2.80 


15.00 


-2.50 


0.05 


4 


2.00 


.35 


2.80 


5.15 


.20 


.55 


4.80 


5.30 


19 


.80 


.15 


1.70 


2.35 


.05 


.75 


1.65 


2.00 


8 


.35 


^NAp 


3.30 


3.65 


.05 


.00 


3.70 


4.30 


3 


.10 


^NAp 


2.65 


2.75 


.20 


.25 


2.70 


3.00 


4 


.30 


^NAp 


3.90 


4.20 


.60 


.10 


4.70 


4.75 



the cost per metric ton of ore in South Africa is low 
because of simpler mining methods and lower labor 
costs, the cost per pound of nickel is high owing to low 
nickel grades. Other factors affecting costs include 
mining methods employed, productivity, and charac- 
teristics of the ore. The average underground mining 
cost of $0.80/lb Ni ($22.80/t of ore) is based on 19 
producing underground mines, excluding South Africa. 
Of the 19 mines, 15 are in Canada and contain approxi- 
mately 80 pet of the total available nickel. 

Net milling costs for underground sulfides range 
from $0.15/lb Ni ($4.30/t of ore) for Canadian 
operations to $0.80/ lb Ni ($2.55/ 1 of ore) for South 
African operations. Canadian operations have the 
highest milling on a cost per metric ton of ore basis 
because of multiple concentrate recovery and relatively 
high labor costs. The lower cost of South African 
mines on a per-ton-ore basis results primarily from 
lower labor costs (about 45 pet of the total direct mill- 
ing operating cost) and from economies of scale. 
Although Canada has 15 producing mines, the ore is 
treated in only 5 major mill plants. South African 
plants process nearly twice the amount of ore as 
Canadian mills. 

Smelting and refining costs for producing under- 
ground sulfides range from $1.35/lb Ni in Canada to 
$5.05/ lb Ni for South Africa. South African concen- 
trates are very low grade, containing about 20 pet of 
the nickel contained in Canadian concentrates. There- 
fore, more smelting (sometimes double-stage) and 
refining is required to produce a pound of nickel. 
Smelting and refining costs also include transporta- 
tion, and post-mill processing charges for nonnickel 
commodities. Zimbabwe has few byproducts and rela- 
tively low transportation charges. South Africa, how- 
ever, ships much of its nickel matte to Norway for 
refining; the remaining slimes containing platinum- 
group metals are returned to South Africa for final 
processing. High transportation charges, coupled with 
processing costs for the platinum-group metals, result 



in additional costs for South Africa. However, these 
costs are more than offset by revenues from co- 
products and byproducts. 

Total operating cost (mine, mill, and smelter- 
refiner costs) for producing underground sulfide 
mines ranges from $2.30/ lb Ni for Canada to $9.70/ 
lb Ni for South Africa. Taxes, including property, 
severance, state, provincial, and federal assessments, 
range from $0.05/lb in Canada to $2.80/lb in South 
Africa. South African taxes are higher owing to the 
large revenues appreciated from the platinum-group 
metals. (Taxes for individual mines may actually be 
lower than those estimated since the government may 
offer tax concessions to attract industry.) However, 
South Africa receives large revenues from other 
products which effectively eliminates the cost of nickel 
recovery; nickel is actually a byproduct of PGM min- 
ing. As a result, the net operating costs range from 
$2.50/lb Ni for South Africa to $4.80/lb Ni for Zim- 
babwe. Zimbabwe experiences high mining and smelt- 
ing-refining costs and low byproduct credits which 
result in the high net cost. South Africa has the 
lowest total cost and Zimbabwe the highest. Of the 
primary nickel operations, Canada is the lowest cost 
producer. This is primarily a result of high ore grades 
and byproduct credits. 

Producing Laterites 

Surface laterite mining costs for producers range 
from $0.10/lb Ni ($3.55/t of ore) in the Philippines 
to $0.35/lb Ni ($18.00/t of ore) for New Caledonia. 
The variation in costs primarily results from greater 
depth of mining required for New Caledonian ore and 
greater distance to the processing facilities. The 
average mine operating cost for 15 surface laterite 
operations is $0.30/lb Ni ($11.20/t of ore). 

Smelting and refining costs for laterites include 
all post-mine costs to produce ferronickel and matte 
through production of refined nickel. Transportation 



21 



and byproduct processing are included in smelting and 
refining costs. Costs range from $2.65/ lb Ni for the 
Philippines to $3.90/lb Ni for Central and South 
America, largely because of diiferences in type, cost, 
and amount of fuel consumed. A large portion of the 
smelting and refining cost reflects high energy con- 
sumption required to reduce the moisture content of 
ores from about 30 to 5 pet. Byproduct processing 
(cobalt) and transportation are additional costs for 
some properties. In the Philippines about $0.35/ lb Ni 
is required to recover byproducts, primarily cobalt. 

The total operating cost for producing surface 
laterite operations ranges from $2.75/ lb Ni to $4.20/ 
lb and averages $3.15/lb. Taxes range from an esti- 
mated $0.05/lb Ni in New Caledonia to $0.60/lb in 
Central and South America. New Caledonia's taxes are 
relatively low because there are no severance or 
property taxes. 

When laterite ore is processed to nickel matte, 
byproducts can be recovered. For example, the Exmi- 
bal mine in Guatemala produced nickel matte from 
which nickel and cobalt were recovered. Byproduct 
credits, mostly from cobalt, range from a low of $0.00/ 
lb Ni in New Caledonia, to $0.25/ lb in the Philippines. 
New Caledonia recovers only a small amount of cobalt. 
The average byproduct value for producing laterites 
is $0.10/lb. 

The net operating cost for producing laterite 
operations ranges from $2.70/lb Ni to $4.70/lb, an 
average of $3.80/lb. Total cost, including profit at a 15 
pet rate of return and recovery of capital, ranges from 
$3.00/ lb Ni to $4.75/ lb. At the January 1981 nickel 
price of $3.50/lb, only 11 of the 22 producing laterite 
operations studied could actually cover net operating 
costs. This explains why so many mines have had 
extended holidays, reduced output, temporary closures, 
and total shutdowns. With a total cost at a 15-pct 
DCFROR, only 3 of the 22 mines could operate 
profitably. 



Nonproducing Sulfides 

The weighted average mining cost for nonproduc- 
ing surface sulfide operations in Canada is estimated 
at $2.05/lb Ni, or about $11.75/t of ore (tables 9 and 
10). The average cost for surface mining of sulfides 
in the United States is estimated at $1.80/lb Ni, or 
$5.30/t of ore. The difference between the operating 
costs is mostly due to lower ore-to-waste stripping 
ratios in the United States. Underground mining costs 
for nonproducers in Canada are about $1.80/lb Ni, or 
$26.85/t of ore. 

Mill costs for nonproducing sulfides are generally 
comparable on a per metric ton of ore basis, but on a 
per pound of nickel basis they range from $0.35 in 
Canada to $1.00 in the United States. The variation 
on a per pound of nickel basis results from relatively 
high Canadian ore grades. Ore beneficiation methods 
are similar. 



TABLE 9. — Estimated mine and miil operating costs for 

nonproducing mines 

(January 1981 dollars per metric ton of ore) 

Number Average Average 
Ore type, type of of ore grade, annual ore Mine Mill 

operation, and country mines pet capacity, 10^ t cost cost 

SULFIDE 
Surface: 

Canada 5 0.38 1,362 $11,75 $4.40 

United States 6 .20 9,587 5.30 2.90 

Average U ^0 5,848 ToO 3.30 

Underground: 

Canada 10 .85 1,569 26.85 5.40 

United States 10 .20 7,263 11.75 3.30 

Average 20 32 4,416 14.50 3.70 

LATERITE 
Surface: 

Brazil 7 1.44 1,174 3.80 NAp 

New Caledonia 5 1.58 1,480 4.00 NAp 

United States 4 .86 1,462 5.15 NAp 

Average 16 iTsO 1,342 4.00 NAp 

NAp Not applicable, included in smelter-refinery cost. 



TABLE 10. — Estimated production costs for nonproducing nickel deposits in selected countries 
(January 1981 dollars per pound of nickel) 



Number of Mine Mill 

Ore type, type of operation, and country mines cost cost 

SULFIDE 
Surface: 

Canada 

United States 

Average 

Underground: 

Canada 

United States 

Average 

LATERITE 
Surface: 

Brazil 

New Caledonia 

United States 

Average 16 .15 ^N Ap 

NAp Not applicable. 

' Summation of mine, mill, smelter, and/or refinery cost. 

^ Includes property, severance, state, provincial, and federal tax where applicable 

total costs often incur liigh taxes. 
^ Total operating cost plus taxes less byproduct credits. 
" Total operating cost plus recovery of capital and profit at a 15-pct ROR. 
^ Post-mine processing of laterites is included in smelter-refinery cost. 



Smelter- 
refinery 
cost 



Total 

operating 

cost' 



Taxes^ 



Net Total cost 

Byproduct operating including a 
credits cost' 15-pct ROR" 



5 
6 


$2.05 
1.80 


$0.75 
1.00 


$1.15 
2.40 


$3.95 
5.20 


$2.45 
.70 


$2.00 
3.90 


$4.40 
2.00 


$8.30 
4.80 


11 


1.90 


.90 


1.90 


4.70 


1.40 


3.10 


3.00 


620 


10 
10 


1.80 
3.65 


.35 
1.00 


1.35 
2.35 


3.50 
7.00 


.55 
2.10 


.50 
5.50 


3.55 
360 


4.50 
8.00 


20 


2.70 


.70 


1.85 


5.25 


1.30 


2.95 


3.60 


6.25 


7 
5 
4 


.15 
.15 
.35 


^NAp 
^NAp 
^NAp 


2.20 
2.75 
2.90 


2.35 
2.95 
3.25 


1.90 

1.10 

.15 


.00 
.20 
.55 


4.25 
3.85 
2.85 


7.40 
5.00 
4.25 



2.45 



260 



1.30 



,15 



3.75 



5 65 



Many taxes are based on total revenues: therefore, those deposits having high 



22 



Smelting and refining costs for nonproducing 
surface sulfide operations vary from $1.15/lb Ni for 
Canadian surface deposits to $2.40/lb for operations 
in the United States. The higher U.S. costs are mostly 
caused by tolling charges, while Canada's industry is 
vertically integrated. 

The total operating cost for nonproducing sulfide 
deposits ranges from $3.50/lb Ni for underground 
deposits in Canada to $7.00/ lb for underground de- 
posits in the United States. Taxes range from $0.55/ 
lb in Canada to $2.45/lb for surface operations in 
Canada. Taxes are high for Candian surface and U.S. 
underground mines, owing to large revenues necessary 
to recapture the high cost of capital. 

Byproduct credits for Canadian underground 
mines average $0.50/lb Ni compared with $5.50/lb 
for underground deposits in the United States. By- 
product credits in the United States are primarily 
from copper with lesser amounts from precious metals. 

Net operating costs range from $2.00/lb Ni for 
surface deposits in the United States to $4.40/ lb for 
Canadian surface mines. The low U.S. costs are due 
to surface mines' low stripping ratios and relatively 
high byproduct credits. 

Total costs range from $4.50/ lb Ni for under- 
ground Canadian deposits to $8.30/ lb for Canadian 
surface operations. Total costs for surface and under- 
ground sulfide deposits woaild be nearly equal, averag- 
ing $6.20 and $6.25, respectively. These costs are more 
than 3 times greater than those of currently producing 
mines. Therefore, it is unlikely that many non- 
producing deposits will be brought on line in the near 
future. 

Nonproducing Laterites 

Laterite mining costs for nonproducing deposits 
range from $0.15/lb Ni in Brazil ($3.80/t of ore) and 
New Caledonia ($4.00/t of ore) to $0.35/lb Ni ($5.15/ 
t of ore) in the United States. The lower costs in 
New Caledonia and Brazil are primarily due to lower 
labor costs, simpler mining methods, and higher ore 
grades. Milling costs for laterites are included in 
processing through ferronickel or nickel metal at the 
smelter-refinery costs. These costs range from $2.20/ 
lb Ni in Brazil to $2.90/lb in the United States. 

The total operating cost ranges from $2.35/lb Ni 
in Brazil to $3.25/lb in the United States. Non- 
producing laterite operations in the United States are 
estimated to pay the lowest taxes, $0.15/lb Ni, and 
Brazil would have the highest, $1.90/lb. The dif- 
ference is due to Brazil's tax structure, which levies 
high severance taxes and royalties. Byproduct credits 
for the United States are the highest of the non- 
producing laterites, resulting from the recovery of 
cobalt. 

The net operating cost for nonproducing laterites 
ranges from $2.85/lb in the United States to $4.25/lb 
in Brazil. The low net operating cost in the United 
States results from lower taxes and a high potential 
byproduct credit. Total cost (including a 15-pct rate 
of return) varies from $4.25/ lb Ni in the United 
States (due to high byproduct credits) to $7.40/lb 
in Brazil. Because of their low cost, U.S. laterite de- 



posits (Gasquet, Red Flat, Pine Flat, and Guanijibo) 
have attracted interest from several mining concerns. 
Gasquet and Guanijibo have had feasibility projects 
performed and have experienced some preliminary 
development work. 



CAPITAL COSTS 

Capital costs include acquisition of land, explora- 
tion, mine development, mine and mill plant and equip- 
ment, and infrastructure where required. Capital 
costs for smelters and refineries for nonproducing 
operations were included when they were either 
proposed or when capacity for post-mill processing by 
tolling were unavailable. Capital costs, therefore, 
reflect the total investment required for those deposits 
not producing at the time of the study to develop the 
mine, construct all facilities, and begin production. 
Capital costs for producing mines are not discussed 
in this section because most of the sulfide and some 
of the laterite operations have been producing for 
long periods and a large portion of the initial cost 
has been depreciated. 

Surface sulfide operations (similar to those pro- 
posed in Minnesota), capable of producing approxi- 
mately 11,500 tpy of nickel, require an average capital 
cost of about $175 million (in 1981 dollars), or about 
$6.90/ lb of recovered nickel per year. Approximately 
6 pet of the cost is in development, 55 pet in mine 
plant and equipment, and the remainder in mill plant 
and equipment. A smelter or refiner is not included 
in this total. 

In the United States, a laterite operation with a 
proposed ore capacity of 1.1 million tpy of ore, which 
would produce 7,600 tpy of nickel, would cost an 
estimated $230 million or about $13.70/ lb of recover- 
able nickel. The distribution is as follows: 3 pet for 
development and infrastructure, 8 pet for mine plant 
and equipment, and the remainder for mill plant and 
equipment. Mill costs include facilities for a roast- 
reduction leach process. 

Inflation has caused capital costs to increase 
dramatically during the last decade. As an example, in 
1971, the Falcondo smelter, which processes laterite 
to ferronickel, was completed at a cost of $182 million 
(1971 U.S. dollars), excluding working capital, at a 
design capacity of 63 million lb of nickel annually 
iH). The efficient overall design of the plant allowed 
an annual capacity of 68 million lb, thereby lowering 
the capital cost per annual pound from $2.90 to $2.70. 
In 1981, a capital cost of about $1 billion would be 
required to replace the operation or $14.70/ lb of 
annual capacity {H) . 

Capital costs relating to environmental factors 
have had a significant impact on production costs. 
In 1980, Faleonbridge completed a smelter environ- 
mental improvement program at Sudbury, Ontario, 
at a capital cost of $83 million. Inco is considering the 
implementation of a fluid bed roaster in Sudbury at a 
cost of "hundreds of millions of dollars" {H) which 
would reduce sulfur emissions from 30 to 11 pet and 
double sulfuric acid production. 

Another example of the effects of environmental 



23 



legislation results from a decision made by the Ontario 
minister of environment. Inco has been ordered to 
reduce its capacity from the Copper Cliff smelter from 
181,000 tpy of matte to 127,000 tpy because of SO. 
emissions. Although this order does not have imme- 
diate impact because of current low recessionary levels 
of production, the regulation effectively limits future 



nickel production in the Sudbury District. A cutback 
in nickel production also affects the production of 
copper, cobalt, and precious metals. In order to main- 
tain their current production capacity and comply 
with the law, a capital cost of $100 million may be 
required. By mid-1983 even more stringent regulations 
were scheduled to go into effect. 



NICKEL AVAILABILITY ANALYSES 



METHODOLOGY 



TOTAL AVAILABILITY 



Analyses are presented in this section to indicate 
the availability of nickel from the deposits evaluated 
in this study. Availability curves relate recoverable 
nickel from all the deposits to total costs of production. 
Annual availability curves, also presented, illustrate 
annual production capabilities and take into account 
time lags involved in reaching full production. Other 
curves presented in later sections illustrate the impact 
of changes in byproduct revenues, energy costs, and 
labor costs, on production cost and nickel availability. 

Certain assumptions are inherent in these 
analyses : 

(1) All deposits produce at design capacity 
throughout their life. 

(2) Each operation is assumed to be able to sell 
all of its output at the determined total cost. 

(3) Owing to the unusually high values of certain 
metals such as gold, silver, and platinum in 
January 1981, all revenues from byproducts 
are based on 1981 market values (table 11). 
It was assumed that all of the byproducts 
could be sold at these prices. 

(4) No definite startup dates were known for 
nonproducing deposits; development work 
was assumed to begin in year "N." 

(5) Time lags related to permitting, environ- 
mental impact statements, and other possible 
delays affecting production are minimized. 

Some evaluated deposits could be prevented from 
production because of a lack of capital, environmental 
problems or issues, political reasons, a poor economic 
climate, or other constraints not known at this time. 

TABLE 11. — Commodity prices used in analyses 

Commodity: January 1981 price 

Cadmium per lb $ 2.50 

Chromlte (29.9 pet) per lb '.04 

Cobalt per lb 25 qo 

Copper per lb 0.89 

Gold per oz ^425.00 

Iridium per oz 600.00 

Iron per It .74 

Lead per lb .34 

Osmium per oz 153.00 

Palladium per oz 200.00 

Platinum per oz 475.00 

Rhodium per oz 700.00 

Ruthenium per oz 45.00 

Silver per oz ^1 0.00 

Sulfur per It 117.50 

Uranium per lb 25.00 

Zinc per lb .41 

' Estimate based on a laterite chromite recovery feasibility study for a 

low-grade chromite concentrate. 
^ Price was selected to reflect a more representative long-run market value. 



Total availability of nickel from deposits in 
market economy countries is illustrated in figure 9. 
This figure relates the total cost of production for 
118 properties to the amount of nickel potentially re- 
coverable. Separate curves are shown for nickel avail- 
able from sulfide and laterite deposits. Approximately 
73 million t of nickel is potentially recoverable from 
the deposits analyzed; however, a total cost exceeding 
$10/lb would be required for all to produce at a 15-pct 
DCFROR. Table 12 illustrates the total nickel poten- 
tially available within selected total cost ranges. 
Figures and analyses include only those properties 
which can produce with a 15-pct DCFROR up to $10/ 
lb. An additional 1.2 million t of nickel, less than 2 
pet of the total recoverable nickel resource evaluated, 
is available at production costs above $10/ lb. 

In 1981 the market price of nickel was about 
$3.50/lb. At that price, approximately 11.4 million t 
of nickel could be economically mined. Of this amount, 
about 10.1 million t is available in currently producing 




5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 
TOTAL RECOVERABLE NICKEL, lO^t 

FIGURE 9.— Total recoverable nickel available trom market 
economy countries. 



TABLE 12.— Total recoverable nickel from market economy 
countries, at selected cost ranges (thousand metric tons) 

Total cost range 

(dollars per pound) Sulfides Laterites Total 

$0 through $3,50 10,260 1,136 11,396 

$3.51 through $5,00 3,997 10,395 14,392 

$5.01 through $7.00 2,190 29,382 31,572 

Over $7.00 4,460 11.417 15,877 

Total 20,907 52,330 73,237 



24 



mines primarily in Canada (64 pet), South Africa 
(19 pet), the United States (2 pet), and the Philip- 
pines and Australia (14 pet combined). Approximately 
10.3 million t, or 90 pet of the nickel potentially avail- 
able at a price of $3.50/lb, occurs in sulfide operations. 
At a production cost of $5/ lb, the quantity of 
economically recoverable nickel would increase to 
nearly 26 million t. At that cost, nearly 80 pet of the 
nickel vi'ould be from producing mines. Most of the 
remainder would come from currently undeveloped 
deposits primarily in Canada (~ 2.5 million t), the 
United States (1.4 million t), Australia (1.2 million t) 
and the Philippines (~ 1.1 million t). 

Sulfides 

Although the nickel sulfides included in this study 
are generally the lowest cost producer, they represent 
less than 30 pet of the total nickel available. Table 12 
illustrates nickel pKjtentially available from sulfides 
within selected price ranges. As shown, an estimated 
21 million t of nickel originates from sulfide deposits. 

Nickel from sulfides accounts for 90 pet or 10 
million t of the nickel available below a cost of $3.50/ 
lb. Of this total, 64 pet is from mines currently produc- 
ing. In general, sulfide operations can produce nickel 
at a lower cost than laterites because of less energy 
consumption, higher byproduct revenues, and older 
more depreciated operations. The weighted average 
total cost for currently producing sulfide operations, 
excluding South Africa, is approximately $1.75/ lb. 

Approximately 2 million t of nickel is potentially 
recoverable for less than $l/lb from South Africa. 
Two of the South African mines require no revenues 
from nickel production in order to economically pro- 
duce because all costs are covered by the primary 
products, platinum-group metals. Nickel available from 
South Africa, therefore, is dependent upon the pro- 
duction of platinum-group metals. 

Canada has approximately 6.6 million t of recov- 
erable nickel available in producing mines, at or below 
$3.50/lb and represents about 65 pet of the total nickel 
available from producers at that cost. The United 
States has a resource of about 4.4 million t of recover- 
able nickel in sulfides or about 85 pet of the total 
evaluated U.S. resource. 

Laterites 

Only about 1.1 million t of recoverable nickel is 
available from laterite deposits at a price of $3.50/lb. 
Currently producing mines account for 89 pet of the 
total, while the remainder is from Guanajibo, Puerto 
Rico. The higher cost of production for laterites is 
primarily a result of high energy costs. At this price, 
nickel availability is split nearly equally between South 
America (primarily Colombia), Greece, and the Philip- 
pines. 

At a nickel price of $5/lb, an additional 10.4 
million t of nickel would potentially become available. 
Most of this nickel would come from New Caledonia 
(45 pet), the Philippines (20 pet), and Greece (18 
pet) . About 89 pet would be from currently producing 
mines. There is an additional 40.8 million t of recover- 



able nickel available above a total cost of $5.65/ lb. 
Laterite nickel total costs average $4.50/ lb from pro- 
ducing mines because of high mining, transportation, 
and/ or energy costs. Capital costs also negatively 
affect some of these operations since they were built 
more recently than the sulfide mines. 

Regional Availability 

Canada and the southwest Pacific region (Aus- 
tralia, Indonesia, New Caledonia, and the Philippines) 
account for about 70 pet of the nickel potentially re- 
coverable from market economy-countries. Nickel avail- 
able from these regions and from the United States 
is discussed in this section. From these three areas, 
9.4 million t of nickel can be produced at a cost of 
$3.50/ lb or less with 75 pet from Canada, 15 pet from 
the southwest Pacific, and 10 pet from the United 
States. Canada has the lowest total cost of production, 
with the cost of producing mines averaging only $1.80/ 
lb Ni. Southwest Pacific producing mines average 
about $4.40/lb Ni. In 1981 Canada produced about 33 
pet of the nickel from market economy countries while 
the southwest Pacific region produced about 40 pet. 
At $5/ lb, a total of 20.8 million t is potentially avail- 
able from these three regions, with 44 pet from 
Canada, 48 pet from the southwestern Pacific, and 8 
pet from the United States. 

The southwest Pacific region includes 7 sulfide 
and 30 laterite deposits. Figure 10 illustrates the nick- 
el resources for this region. The total nickel recover- 
able from the Southwest Pacific deposits studied is 
approximately 42 million t, 58 pet of the total recover- 
able resource considered in this study. Of this 42 
million t, approximately 26 pet is from currently 
producing mines. At a total cost of $3.50/ lb, only 1.4 
million t of nickel is available from producers, of 
which 46 pet is from Philippine laterites and the 



° 5.00- 



O 4.00 



1.00 



- 


1 1 1 — 


— 1 1 r— 

Nonproducers 1 
1 


Total F 




jProducers 


,..r 


_y - 




J 






- J" 


--L-y 




- 


Y 


'"^'"'^ 




- 


f 


„..i 1 — 




1 



TOTAL RECOVERABLE NICKEL, IO«t 



FIGURE 10.— Total recoverable nickel from southwest Pacific 
producers and nonproducers. 



25 



6.00 



•i 5.00 



1.00, 



T 1 n r 



: Nonproducers 



-I 1 1 1 

Total 



j Producers 

I 

I 




r-*^ 7^ 



i J 



^ 



2 3 4 5 6 7 

TOTAL RECOVERABLE NICKEL, lO^t 



FIGURE 11. — Total recoverable nickel from Canadian produc- 
ers and nonproducers. 



remainder from Australian sulfides. At a production 
cost of $5/ lb, a total of 7.7 million t would be poten- 
tially available from producers and 2.2 million t avail- 
able from nonproducers. There is no nickel available 
from this region from nonproducing deposits below a 
cost of $4.35/lb. 

Figure 11 illustrates nickel available from produc- 
ing mines and nonproducing deposits in Canada. A 
total of 10.7 million t of nickel is potentially recover- 
able from the 33 sulfide deposits studied. Eighteen 
mines, producing at the time of this study, account 
for 6.7 million t of recoverable nickel, while nonproduc- 
ing properties have 4 million t. At a total cost of 
$3.50/ lb, 7.0 million t is available, 6.6 million from 
producing mines. At a cost of $5/ lb, a total of 9.2 
million t is potentially recoverable. An additional 1.5 
million t of nickel is potentially available at a cost 
above $5/ lb. 

Figure 12 illustrates total recoverable nickel from 
the 21 domestic nicked deposits (including Guanajibo) 



in this study. Only one mine, Hanna's Nickel Moun- 
tain ferronickel mine in Oregon, has produced in re- 
cent years, and the operation was temporarily closed 
in early 1982. 

Total nickel occurrences in the United States, 
including Nickel Mountain, have 5.1 million t of 
recoverable nickel, which is nearly 15 pet of the total 
nickel resource considered in this study. Of this total, 
4.5 million t is recoverable from sulfide ores, while the 
remainder is from laterites. At a total cost of $3.50/ lb, 
955,000 t of nickel is recoverable. At this cost, about 
50 pet of the total would be from sulfide deposits. 
Virtually all of the 490,000 t available from sulfides 
at $3.50/lb, occurs in Minnesota near the Boundary 
Waters Canoe Wilderness Area. Development in this 
State has been affected by concerns for water and air 
quality, land reclamation, and the negative effects of 
mining on aesthetics. In addition, Inco is a part owner 
in some of these properties and may want to avoid the 
possible loss of jobs in Canada and competition with 
its Canadian operations. 

At a total cost of $5/ lb, an additional 700,000 t 
of nickel is available, 88 pet from sulfide deposits in 
Minnesota. Above $5/ lb, 3.5 million additional tons is 
available, of which 90 pet is from sulfide deposits in 
Minnesota. 

In summary, little new development from non- 
producing deposits can be expected in these regions 
in the near future. Approximately 1.2 million t of 
nickel could be recovered from nonproducers at a total 
cost of $3.50/ lb. Of this potential, 43 pet is from sul- 
fide deposits in the United States, primarily Minnesota, 
where environmental constraints and other criteria 
may preclude development. There are, however, cur- 
rent producers with nickel available at a total cost of 
less than $5/ lb. A total of approximately 14.4 million 
t is available from producers in these 3 regions, of 
which 55 pet is in the southwest Pacific, 40 pet is in 
Canada, and nearly 5 pet in the United States. It 
appears then, that barring development of nickel 
resources in Minnesota, new deposits will be first 
developed as extensions of producing properties in 
Canada where nickel is available at a total cost of less 
than $3.50/ lb and development is relatively simple. 




0.5 1,0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 

TOTAL RECOVERABLE NICKEL, lO^t 

FIGURE 12.— Total recoverable nickel from U.S. deposits. 



ANNUAL AVAILABILITY 

An analysis was performed to estimate the poten- 
tial annual production capabilities of producing mines 
and nonproducing deposits. Production potential for 
nonproducers was estimated based upon deposit size 
(demonstrated resources) and capacities of similar 
producing operations. Estimates of production poten- 
tial at capacity levels for the next 15 yr are provided. 
Although some of the curves indicate a decrease in 
production capacities before 1995, many of these 
declines may not occur since most mines presently are 
not operating at capacity. In addition, as market con- 
ditions improve, existing mines may expand produc- 
tion, nonproducing deposits may come on line, addi- 
tional ore bodies may be discovered, and inferred ore 
resources may be reclassified as demonstrated. 



26 



PRODUCING MINES 

Figure 13 illustrates the annual production poten- 
tial from producing mines at a total cost of $3.50/lb 
or less. Based on the evaluated properties, in 1981 
there was approximately 335,000 t of nickel production 
capacity in this cost range. Of this total production, 
65 pet was from Canada, 13 pet from South Africa, 
13 pet from Australia, 7 pet from the Philippines, and 
about 1 pet from Brazil and Finland combined. The 
Nickel Mountain laterite mine in Oregon, which was 
in production in 1981, accounted for only 4 pet of the 
total. Of this, 72 pet is available from sulfide ores. 
The fact that the majority of the low-cost nickel is 
from sulfide ores is due both to lower energy require- 
ments for recovery of nickel from sulfide ores, by- 
product revenues, and partially because of older es- 
tablished production from sulfide operations where 
large capital costs have already been amortized. Total 
1981 market economy mine production was approxi- 
mately 506,000 t, which indicates that many mines 
were either unable to receive a 15-pct rate of return 
or were able to implement changes to improve the 
economics of the operation. When market conditions 
did not improve in 1982, market economy mine pro- 
duction dropped to about 369,000 t. 

From 1981 to 1995, at a total cost of $3.50/lb, 
there is a potential significant decrease of nickel 
available from sulfide producers, while production 
from laterites remains essentially unchanged. (It is 
important to note that several countries, especially 
Canada, do not report data indicative of their actual 
total reserves. This may be because of the proprietary 
nature of tonnage data, taxation policy, and limited 
exploration programs.) In 1995 there is a production 
potential of 210,000 t of nickel from producers at a 
total cost of $3.50/lb, nearly 40 pet less than that in 
1981. Of the total, 63 pet would be from sulfides and 
37 pet from laterites. The total distribution, by coun- 
try, would be as follows: Canada (62 pet), Philippines 
(12 pet). South Africa (12 pet), Australia (8 pet), 
and the United States (6 pet). 

Annual production potential from Canada and the 
southwest Pacific region are shown on figures 14 and 



400 




-1 1 1 


1 1 


350 


k^^_____^ 




/Total 


4- 




"• —^^ ""^"^^^^ 


^ 


O 300 


3^' ""~~- 


~- 


— C..,.^^ 


_r 




'' ""-■~^, 


J^~^v^ 


^ 250 


. 




\ '^^^ ~v 










<J 






\ '^ ^v 


Z »~. 






Sulfide ^ N 


. , 20C 






\ 








\ 


-J 








CO 








< 150 


_ 




- 










u 








> 








8 100 
UJ 


- 




/Loterite 


(T 






/ 


50 


- 




/ : 





11.11 _1 1 



1961 



1987 1989 

YEAR 



1995 



FIGURE 13.— Total annual nickel production potentially 
available from producing sulfide and laterite mines at $3.50 per 
pound of nickel. 



Ui 

O 150 



1 1 1 1 — 

' ■■■■■• y\ 




- 


'\0-$3.50 


/\ 


.^ 0-$2.00 


1 1 1 1 


1 1 



1961 1963 1985 1987 1989 

YEAR 



1993 1995 



FIGURE 14. — Potential annual nickel production from pro- 
ducing mines in Canada. 



0-$5.00 



\ 



0-$4.00 



0-$3.50 



0-$2.50 



1987 1989 

YEAR 



FIGURE 15.— Potential annual nickel production from pro- 
ducing mines in the southwest Pacific. 



15, respectively. Canadian production from current 
producers decreases dramatically owing to the ex- 
haustion of reported demonstrated reserves. As men- 
tioned earlier, there are many factors that could affect 
this potential decline. Resources presently classified as 
inferred may be reclassified to the demonstrated level, 
new discoveries may occur, mines may not operate at 
capacity thereby extending the mines life, and im- 
proved market conditions may increase availability. 
Analyses of annual nickel availability from the south- 
west Pacific (Philippines, Australia, New Caledonia, 
and Indonesia) also indicates a decrease in production, 
but to a much smaller degree, with decreases beginning 
only after 1994. Required prices are higher for the 
southwest Pacific region because relatively high min- 
ing and processing costs. 

In 1981, an estimated 52 pet of production evalu- 
ated in this study from producing mines could have 
been produced at a total cost of $3.50/lb or less. 
However, during the year considerable amounts of 



27 



nickel were sold for prices much lower than $3.50/lb. 
As a result many mines were unable to recover total 
production costs while others incurred considerable 
losses. Some higher cost producers, however, continued 
to operate. Reasons for remaining open included (1) 
the ability to cover variable costs, (2) the need to 
satisfy contractural agreements, (3) the need to 
generate cash flow, (4) government subsidies were 
supplied, and (5) the deposits were government 
owned and remained open for social reasons such as 
providing employment. In 1982, production of nickel 
from MEC's dropped more than 25 pet because of 
further closures, continued stockpiling, and reductions 
related to the poor nickel market. 

At an estimated annual growth rate in consump- 
tion of 2.1 pet, by 1995 approximately 680,000 t of 
nickel could be consumed by market economy coun- 
tries. However, at a total cost of $3.50/ lb or less, only 
30 pet, or 210,000 t of this demand could be met by 
producing mines; at that time an additional 48,000 t 
is potentially available at $3.50/ lb from deposits not 
now in production. The remaining demand could come 
from expansion of current operations such as laterites 
in the Philippines, development of new, higher cost 
deposits or the discovery of new mines. It is esti- 
mated that nickel prices approaching $6.50/ lb would 



be required to economically support production at this 
level. 



NONPRODUCING DEPOSITS 

Annual availability curves for nonproducing de- 
posits compare estimated production costs with poten- 
tial annual capacity. Because definite startup dates are 
not known, it was assumed that all nonproducers began 
preproduction in the hypothetical base year N; thus, 
the tonnage available in a given year is likely over- 
stated, since all nonproducers will not actually begin 
preproduction simultaneously. Under this assumption 
all deposits would be producing at full capacity by 
year N+5. 

Potential nickel production from nonproducers is 
illustrated in figure 16. The large surges that occur 
in the early years are the result of the nonproducing 
properties reaching production status. In year N+3, 
the production potential from nonproducing deposits is 
41,000 t at a nickel price of $3.50/ lb, 119,300 t at a 
price of $5.00/ lb, and 250,000 t at $7.50/ lb. Non- 
producing deposits have the potential to produce over 
550,000 tpy of nickel ; however, nickel prices approach- 
ing $7.50/lb would be required. 



f(X) 
600 


- 


N 


— 1 1 r 

Year preproduction 
development begins 

/- 

/ 
/ 
/ 
/ 
/ 
/ 
/ 


1 r 

Total 


0-$7.50 


500 










400 






/ 

/ 
/ 

/ 






300 


- 




/ 




- 


200 






/ 
/ 
/ 
/ 




0-$5.00 








/ * 






100 




t 
1 

— k 






0-$3.50 


n 


^ ^ , 


1 L 


1 



ibO 






—[ T 

Southwest 


Pacitic 




^00 


- 








0-$8.50 




/ 
/ 




?50 


- 




/ 




0-$7.00 




. 1 




^> 








/-"-^ / 






200 


- 




/ / 




- 


150 


- 


/ 


/ J 

\ r 
1 




- 


ICO 


- 


1 


1 
1 




0-i6.00 


50 


r 


/-'■■ 


^ 


1... 


0-$5.00 
1 1 


rt 


1 


L, 1 



N+2 N+4 N+6 N+8 N+10 N+12 N+14 N N+2 N+4 N+6 N+8 N + IO N + 12 N+14 

1 1 1— 1 1 —I 



— I 1 r 

United States 




Canada 




^\^ N+4 Srti STfi t^O fJ+Ii N + 14 N N+2 N + 4 N+6 N + 8 N+IO N+12 N + 14 

YEAR 



FIGURE 16.— Potential annual nicKel production from nonproducing nickel deposits. 



28 



Potential annual production from nonproducing 
deposits in Canada, the southwest Pacific, and the 
United States is also shown. The United States has 
only 30,000 t of nickel which could be recovered 
annually at $3.50/lb, Canada has a maximum of about 
38,000 t, and the southwest Pacific has none. 

Although the United States has large potential 
resources of nickel, development could be impaired by 
several factors related to environmental and social 
issues. A large portion of U.S. resources border the 
Boundary Waters Canoe Wilderness area of Minne- 
sota; it is expected that development in this area 
would be difficult. In addition, significant recovery of 
the currently depressed nickel industry would be 
necessary in order to encourage development of these 
higher cost properties. At a price of $3.50/ lb, U.S. 
deposits are capable of producing 27,000 t of nickel 
6 yr after preproduction begins. Production could 
remain nearly constant for at least 10 yr. All U.S. 
production at or below $3.50/ lb would originate from 
sulfide deposits. 

Production is most likely to take place in Canada 
because of relatively short preproduction periods, 
general social acceptance of mining, and regional 
economic dependence upon a well-developed nickel 



industry. At a price of $3.50/lb, Canadian production 
of 31,000 t could be available by year N+2, with 
production at year N+10 leveling off at approximately 
18,000 t. This could compensate for about 30 pet of 
the projected decrease in production (if it actually 
occurs) from Canadian producers in 1995. 

Nonproducing deposits in the southwest Pacific 
have a much higher total cost than those in Canada or 
the United States. Production from these deposits 
could begin at a total cost nearing $5/ lb Ni; however, 
much higher costs would be incurred to produce sig- 
nificant quantities of nickel. At a nickel market price 
of $5/lb, 34,000 tpy could be annually produced by 
year N+5, increasing to about 225,000 t at a price 
of $8.50/lb. 

It appears likely, in the short term, that producing 
laterite deposits will generally maintain their overall 
market share (if energy and labor costs and company 
and/or government policies, etc., remain relatively 
unchanged). However, as current economic reserves 
are depleted in some mines, new production will most 
likely occur from sulfide resources in Canada (pri- 
marily from expansions in existing mines). Production 
is possible in the United States if several environment- 
al and social issues can be resolved. 



FACTORS AFFECTING NICKEL PRODUCTION COSTS 



Costs associated with mining and processing 
nickel have been dramatically affected by increases in 
both energy and labor costs. Revenues have also been 
affected greatly by byproduct commodity prices. These 
changes have caused major shifts in the market 
shares of both companies and countries, especially 
since 1973. Analysis of the impact of energy and labor 
costs and byproduct prices on sulfide and laterite 
deposit economics is presented in this section. 



ENERGY 

Energy costs over the last decade have increassd 
dramatically. Recovery of nickel from laterites is 
more energy intensive than nickel from sulfides and as 
a result the cost of nickel recovery from laterites is 
generally higher. Despite government fuel subsidies 
for some producers in the southwest Pacific, increases 
in energy cost have reduced the market share of nickel 
from many laterite operations. 

Sulfides 

Approximately 10 Kwh of energy is required to 
produce 1 lb of nickel from sulfides (15). Of this 
amount, 3 to 4 Kwh is used for underground mining 
and beneficiation and the remainder for smelting and 
refining. 

Hydroelectric power, especially when company 
owned, offers several advantages; it is a reliable power 
source, inexpensive, and essentially unaffected by in- 
creases in fossil fuel costs. Canadian nickel companies, 



which consume hydroelectric power for part of their 
energy requirements, expend about 20 pet of total 
operating costs on energy, whereas other deposits 
spend 25 to 30 pet of their operating costs for energy. 
Therefore, an increase in energy costs would result 
in a somewhat lesser impact on Canadian producers 
than on mines which do not have access to hydro- 
electric power. In order to illustrate the effect of an 
increase in energy cost on the total cost and avail- 
ability of nickel, a 50-pct increase in energy cost has 
been assumed. As shown in figure 17, such an increase 
would result in about a 5-pet decrease in total nickel 
available at or below $3.50/lb. At $5/lb, 12.2 million 
t is available or 15 pet less than before the energy 
cost increase. The total cost for all sulfide deposits 
would increase about $0.55/lb from $3.90/lb to $4.45/ 
lb, or about 15 pet. 

Laterites 

Operating costs associated with laterite deposits 
have large fuel components. Energy costs can account 
for 40 to 60 pet of total operating costs, about three 
times that of Inco's Canadian sulfide mines (16). The 
burden of these costs is on the postmining stages 
(drying, calcining, smelting, and refining). 

Fuel cost increases have had an even greater im- 
pact on the profitably of laterite operations than on 
sulfide operations. Relatively new laterite operations 
have been shut down, apparently owing to energy cost 
increases. At Exmibal, Guatemala, energy costs rep- 
resented nearly 60 pet of the total operating costs. 
Approximately 4,000 bbl/d of fuel oil were required 



29 




_i I I 



5 10 15 20 25 30 35 40 45 50 

TOTAL RECOVERABLE NICKEL, 10^ + 

FIGURE 17. — Effect of energy cost increases on nickel avail- 
ability. 

to run the turbogenerators. The operation produced 
about 28 million lb of nickel in matte annually at full 
capacity. When the property started in 1977, fuel costs 
were approximately $12.00/bbl. These costs had in- 
creased to about $30/bbl, when a temporary closure 
of the operation was announced in 1981. Assuming a 
full capacity operation at 330 d/yr, the annual fuel 
cost expenditure of $16 million in 1977 rose to $40 
million in 1981, an increase of 150 pet. 

Inco estimated that a $1 increase in the cost of a 
barrel of oil would require a $0.05/lb (January 1981 
dollars) increase in the market price of nickel {10, H). 

In addition, the economics of the proposed Gag 
Island project in Indonesia have also been significantly 
affected by the increased costs for fossil fuels. The 
increase played a major role in the decision to cancel 
its development. Marinduque Mining Corp., in the 
Philippines, is in the process of converting from an 
oil-fired smelter to a coal-fired smelter to lower costs. 

An example of an operating property that has 
been significantly affected by increasing energy costs 
is the Falcondo Bonao laterite operation in the Do- 
minican Republic (table 13). Falconbridge reports 
that from the project's startup in 1973 to 1981, energy 
costs per barrel of oil have risen more than tenfold, 
while the market price of nickel has increased only 
2.3 times. As a result, energy costs have increased as 
a proportion of total operating costs from 9 to 64 pet 
{15). 

As with sulfides, laterite operations that utilize 
hydroelectric power are probably in the best position 



TABLE 13.— Effect of oil price on nickel production at 

Falconbridge Dominicana (Falcondo Bonao) 1973-81 (14) 

(1981 U.S. dollars) 

Total energy Energy cost 
consumption, Average cost Total energy per pound of 
10^ bbl per barrel c ost, millions nickel produced 

1973 3^3 $3.60 $11.9 $0.18 

1974 3.0 11.80 35.2 52 

1975 3,2 11.70 36.8 .62 

1976 2.8 12.00 33.0 .61 

1977 2.7 13,25 36 .66 

1978 1.6 13.20 21.2 .67 

1979 2,8 20.70 58.2 1.05 

1980 1.8 29.45 52.7 1.46 

1981' 1.2 32.50 406 1.65 

' 1981 is a 6-month reporting period. 



for consistently lower cost production. P.T. Inco's In- 
donesian laterite-ferronickel plant at Soroaxo utilizes 
hydroelectric power for about 50 pet of its energy 
needs. Cerro Matoso in Colombia is one of the few 
laterite properties currently being developed and is 
to utilize hydroelectric power and other inexpensive 
local fuel sources {10). 

As previously mentioned, energy costs represent 
40 to 60 pet of operating costs for laterite ferronickel 
operations. Therefore, a 50-pct increase in energy 
costs would result in a 20- to 30-pct increase in overall 
operating costs. This is true of most laterite opera- 
tions because few utilize hydroelectric power to meet 
their energy requirements. 

Figure 17 illustrates the possible effects of a 
50-pct increase in energy costs on laterite nickel 
availability. As a result, the weighted-average increase 
in total production cost is about $1.10/ lb Ni, nearly 
20 pet. Slightly less than half of the nickel that could 
be economically (15 pet ROR) produced at $3.50/lb 
at 1981 energy costs could be produced if energy costs 
increased 50 pet. At $5./ lb, about 5.5 million t or about 
half of the nickel available prior to the energy in- 
crease is potentially available. 

In 1981, approximately 35 pet of the nickel pro- 
duced from market economy countries originated 
from laterite ores. Further increases in energy costs 
could make a large part of currently economic produc- 
tion uneconomic. 

In summary, increases in energy costs have a 
greater impact on laterite operations than on sulfide 
operations. Canadian sulfide producers, which pres- 
ently utilize hydroelectric power for a portion of 
their energy requirements and have lower oil costs 
(from government sources), would have lower cost 
increases than most other sulfides. If energy costs 
increase, more closures of laterite operations and a 
continuing loss of market share to sulfide operations 
seems inevitable unless there is a technological break- 
through in laterite processing technology. However, 
if energy costs continue to decrease as they have in 
1982 and 1983, the position of laterite deposits would 
be improved. 



LABOR 

Labor cost, can account for between 10 and 60 
pet of total operating costs. Labor costs are directly 
related to labor rates, productivity, and the mining 



30 



method. Sulfide mines generally require more labor 
per ton of ore mined because of the complexities asso- 
ciated with underground mining. 

Sulfides 

In 1980, Inco reported that labor accounted for 
nearly 55 pet of total direct underground mine operat- 
ing cost in the Sudbury District despite utilizing 
highly mechanized bulk mining methods. For most 
producing Canadian properties, labor accounts for ap- 
proximately 50 pet of the operating cost. In Canadian 
mines outside of Sudbury and in other countries, labor 
costs can comprise 60 pet of the operating cost be- 
cause of less mechanization and nonselective mining 
techniques. A 50-pct increase in labor cost would in- 
crease operating costs about 25 pet. 

Figure 18 illustrates the effect of a 50-pct in- 
crease in labor cost on total cost and potential nickel 
availability. For these deposits, the average total cost 
would increase approximately 20 pet, about $0.70/lb 
Ni. Due to high mechanization, Canadian producers 
slightly less than most other deposits. Overall, about 
11 pet or 1.3 million t of the nickel potentially avail- 
able at a cost of $3.50/ lb before the labor increase is 
now more expensive. 

Laterites 

Relatively simple, efficient surface mining meth- 
ods and lower salaries in laterite mining countries 
give laterite deposits a labor cost advantage over 



underground sulfides. Labor costs required to recover 
nickel account for only 10 to 15 pet of the operating 
cost (15). (Labor costs at Exmibal, Guatemala, were 
approximately 10 pet of total operating costs.) In 
order to determine the sensitivity of Jaterite deposits 
to labor costs, a 50-pct increase was assumed, result- 
ing in a 6-pct increase in operating costs. 

The effect of this change is illustrated by the 
shaded area in figure 18. As shown, average total cost 
increases approximately $0.25/ lb Ni, from $6.45 to 
$6.70, an increase of only 4 pet. As a result, a labor 
cost increase would have little impact on availability 
of nickel from laterite deposits. 

Given an equal percentage increase in labor costs, 
there is a greater total cost increase for sulfide de- 
posits than for laterite. The complexity of under- 
ground mining methods means that sulfide deposits 
are more labor intensive, resulting in higher labor 
costs, lower productivity, and a greater required num- 
ber of support personnel (ground support, personnel, 
ore haulage, and maintenance). 



COPRODUCTS AND BYPRODUCTS 

Coproduct and byproduct revenues, primarily 
those from precious metals, have had a significant 
effect on the nickel industry. These revenues play an 
important role in the production cost for most sulfide 
deposits, but have less effect for laterites. 



Sulfides 







J I I 



10 15 20 25 30 35 40 45 50 

TOTAL RECOVERABLE NICKEL, I0*t 



FIGURE 18.— Effect of labor cost increases on nickel 
availability. 



Nickel sulfide deposits characterictically contain 
several recoverable metals. The most common co- 
product or byproduct is copper; however, in the Sud- 
bury District cobalt, gold, silver, and the platinum- 
group metals are also recovered. In 1980, approxi- 
mately 30 pet of total revenues from nickel ores in the 
Sudbury District were derived from byproducts (11). 
Australian nickel operations recover copper and some 
cobalt. In South Africa, large amounts of nickel, 
copper, and cobalt are recovered as byproducts of 
platinum-group mines, and in the Great Dyke of Zim- 
babwe, nickel and copper are potentially recoverable 
as byproducts from PGM prospects. 

For sulfide deposits, a 50-pct decrease in by- 
product revenues would increase total costs an average 
of $0.70/lb Ni, or about 20 pet. This relationship is 
illustrated in figure 19. For South African platinum 
operations, where nickel production is a byproduct of 
platinum production, the average increase would be 
about $2. Sulfide deposits in Minnesota have a total 
cost increase of approximately 25 pet because of their 
dependence on revenues from byproduct copper, pre- 
cious metals, and some base metals. A 50-pct increase 
in byproduct value would lower the average total cost 
approximately the same amount, $0.70/ lb, or 25 pet. 

Laterites 

Laterite operations most often product ferro- 
nickel, from which little or no byproduct values are 



31 



•8 




50- pet increase in 
byproduct values 



10 15 20 25 30 35 40 45 50 

TOTAL RECOVERABLE NICKEL, lO^t 

FIGURE 19. — Effect of byproduct revenues on nickel availa- 
bility. 



realized. As a result, most laterlte deposits are un- 
affected by changes in byproduct prices. The analysis 
presented in this section is based only on those laterite 
deposits which recover byproducts. 

The shift in laterite availability as a result of a 
50-pct decrease and increase in byproduct prices is 
shown in figure 19. The weighted-average increase in 
total cost for all laterites that recover byproducts is 
only about 3 pet. Producing mines would increase 
about 3 pet to $4.18/lb Ni, while nonproducing deposits 
would increase about 4 pet from nearly $7/ lb to $7.25/ 
lb. A 50-pct increase in byproduct value have a cor- 
responding decrease in total cost. 

It is apparent that byproducts greatly affect the 
economics of sulfide operations, especially with price 
changes in the precious metals market. Laterites, 
however, are not as affected for two reasons: (1) the 
bulk of production from laterites is ferroniekel, and 
byproducts generally are not produced or credits are 
not given; and, (2) byproducts that are recovered, 
primarily cobalt, have generally low recovery levels; 
thus, revenues are small. 



CONCLUSIONS 



The industrialized world is greatly dependent 
upon nickel as an alloying agent because of its 
strength and resistance to corrosion and heat. At the 
demonstrated resource level, the 126 deposits and 
properties analyzed in market economy countries have 
^n estimated 73 million t of nickel potentially recover- 
able using current technology. Of this total, nearly 35 
pet is from mines producing at the time of this study 
and the remainder is from deposits that are either 
currently shut down, developing, or have no known 
development schedule or startup date. According to 
estimates of the countries studied, the Philippines, 
New Caledonia, and Canada have the largest demon- 
strated nickel resources, accounting for approximately 
60 pet of the nickel recoverable from market economy 
countries. 

At the 1981 market price of $3.50/ lb Ni, an esti- 
mated 11 million t of nickel could be economically 
produced from demonstrated resources; nearly 15 pet 
of the recoverable nickel available from the studied 
deposits. Approximately 90 pet of the 11 million t 
exists in producing properties. At a total cost of $5/lb, 
available nickel would increase to 26 million t, 75 pet 
of which is available from mines producing at the 
time of this study. There is approximately 5.1 million 
t of nickel available from U.S. deposits, only 20 pet 
of which could potentially be produced at a total cost 
of less than $3.50/lb. However, development of these 
resources could be impaired or delayed owing to 



several factors. The extremely high capital outlays 
required and present market conditions produce a high 
investment risk. Environmental constraints and social 
issues related to the proximity of potential mines to 
the Boundary Waters Canoe Wilderness area in Min- 
nesota may delay or totally prevent some development. 
The laterites in California may also be negatively 
affected by environmental and social issues. In addi- 
tion, the proposed technology for nickel and cobalt 
recovery has not been used on a commercial scale. 
Inco's control of some mineral lands may preclude 
development in order to avoid competition with its 
Canadian operations. 

In 1981, mines in market economy countries pro- 
duced approximately 506,000 t of primary nickel ; this 
figure decreased about 25 pet in 1982. Results of this 
study indicate that at the average nickel price of 
about $3.50/lb, only 335,000 t in 1981 could economic- 
ally (15-pct rate of return) be produced. This indi- 
cates that in 1981 many mines continued to operate, 
although they could not cover total production costs, 
in the hope that market conditions would improve. 
However, as economic conditions deteriorated through 
1981 and into 1982, many mines were forced to close. 

By 1995, an annual growth rate in consumption of 
2.1 pet in market economy countries, 680,000 t of 
primary nickel will be consumed each year. However, 
based on the results of this study, at a total production 
cost of $3.50/lb Ni, only 210,000 t will be available 



32 



from current producers. At this cost, it is estimated 
that deposits not now in production are capable of 
producing an additional 48,000 t in 1995. In order to 
meet demand, existing mines will need to expand, new 
discoveries which either prolong mine lives or justify 
new mines, will need to be made, or the nickel market 
price will need to increase so that higher cost non- 
producing deposits can be brought on line. 

The cost of energy for laterite deposits, and labor 
costs and byproduct revenues for sulfides are import- 
ant factors affecting cost of production. Presently, 
most sulfide operations can produce nickel at lower 



costs than laterites. This condition has developed 
primarily as a result of the great increases in fuel 
costs since 1972 and the fact that much of the capital 
associated with sulfide operations has been amortized. 
However, recent decreases in energy costs may even- 
tually change this situation. Although nickel is cur- 
rently experiencing low market demand, low prices, 
and government subsidies, it is apparent from the 
results of economic analyses that Canada, relative to 
other market economy countries, should have a secure 
position in marketing nickel production and could con- 
tinue to maintain this position for some time to come. 



REFERENCES 



1. World Bank. Nickel Handbook. Commodities and 
Export Projection Div. ; Economic Analysis and Projec- 
tion Dep.; February 1981, pp. I-l to III-5. 

2. Matthews, N. A., and S. F. Sibley. Nickel. Ch. in 
Minerals Facts and Problems, 1980 Edition. BuMines 
B671, 1981, pp. 611-627. 

3. Sibley, S. F. Nickel. Ch. in BuMines Mineral Com- 
modity Summeries, 1983. Pp. 106-107. 

4. Mohidie, T. P., C. L. Warden, and J. D. Mason. 
Towards a Nickel Policy for the Province of Ontario. 
Miner. Resour. Br., Div. Mines, Miner. Policy Background 
Paper No. 4, Dec. 1981, 247 pp. 

5. INCO Ltd. 1981 Annual Report. 44 pp. 

6. Falconbridge Ltd. 1981 Annual Report. 62 pp. 

7. Canada Department of Energy, Mines, and Re- 
sources. Mineral Policy Series. Nickel. Miner. Bull. MR 
157, 1976, 53 pp. 

8. Davidoff, R. L. Supply Analysis Model (SAM) : A 
Minerals Availability System Methodology. BuMines IC 
8820. 1980, 45 pp. 

9. Mining Magazine. Nickel Mine Dedicated in Northern 
Colombia. V. 145, No. 8, Aug. 1982. pp. 79-81. 

10. Spooner, J. Mining Annual Review. Min. J. (Lon- 
don), 1982. p. 357. 



11. Engineering and Mining Journal. Sudbury: The 
World's Largest Nickel District. V. 182, No. 11, Nov. 
1981, pp. 84-93. 

12. McKelvey, V. E., R. W. Rowland, N. A. Wright. 
Manganese Nodule Resources in the Northeastern Equa- 
torial Pacific. U.S. Geol. Survey Open File Rep. 78-114, 
1978, 50 pp.; available for consultation at U.S. Geol. 
Surv. Library, Denver West Office Park, Golden, CO. 

13. Boldt, J. R., Jr. The Winning of Nickel— Its Geology, 
Mining, and Extractive Metallurgy. Wadsworth Pub. Co., 
Belmont CA, 1975, 500 pp. 

14. Berry, H. T. Annual Review of Falconbridge Nickel 
Mines. Pres. at New York Society of Security Analysts, 
New York, 1981, 16 pp.; available from the Bureau of 
Mines, Minerals Availability Field Office, Denver, CO. 

15. Dasher, J. The Energy Picture in Nickel Production. 
Pres. at Southwest Minerals Conference, San Francisco, 
1976, 17 pp.; available from the Bureau of Mines, Mineral 
Availability Field Office, Denver, CO. 

16. The Economist (London). Incoherent. Nov. 21, 1980, 
p. 20. 



33 



APPENDIX A.— CENTRALLY PLANNED ECONOMY COUNTRIES 



Albania Laos 

Bulgaria Mongolia 

Cuba North Korea 

Czechoslovakia China 

German Democratic Republic Poland 

Hungary Romania 

Kampuchea U.S.S.R. 

Vietnam 



APPENDIX B.— DEPOSITS INVESTIGATED BUT NOT EVALUATED 

Country and Deposit name Reason for exclusion 

Australia: Mount Scholl Lack of available data. 

Burundi: Burundi laterites Inferred resource. 

Canada: 

Great Lakes Nickel Low-grade nickel. 

Lindsley Exhausted resources. 

Murray Do. 

Thierry Primary copper, low nickel grade. 

New Guinea: Ramu River Lack of available data. 

United States: 

Missouri: Annapolis, Bonne Terre, Primary lead with low nickel grade. 

Brushy Creek, Buick, Flat River, 

Fletcher, Higdon, Indian River, 

Leadwood, Magmont, Mine La 

Motte, Sweetwater, Viburnum, West 

Fork. 

Montana: Stillwater Inferred resources. 

Zambia: Munali No information available. 

Zimbabwe: Hunter's Road Inferred resource. 



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